South Africa is set for a surge in mergers and acquisitions in its mining industry, including a sharp rise in activity in the platinum sector, as Black Economic Empowerment (BEE) takes off.

Industry experts estimate that projects totalling as much as R100 billion will take place in the mining sector over the next five years, with deals such as the one struck between African Rainbow Minerals and Anglo Platinum driving the trend.

The platinum sector is expected to be particularly active in this arena, building on the deals struck in recent years.

Nedbank Corporate managing director for capital markets, Brian Kennedy, told Business Today the initiative, and its associated spate of new laws, has generated a 'frenzy to do empowerment deals'.

Kennedy described the transaction in which African Rainbow Minerals took a stake in Anglo Platinum's platinum mine Modikwa as one of a number of 'landmark' cases that hinted at a boom era.

'The scene is set for significant changes resulting in creative deal structures and capital raising exercises,' Mr Kennedy concluded.