Amplats to sell strike-hit mines

Johannesburg - World No 1 platinum producer Anglo American Platinum [JSE:AMS] said on Monday it planned to sell its Union mine, Rustenburg operations and a joint venture, a widely expected move after it was hit by a five-month strike.

Unveiling its interim results, Amplats said it had lost over 420 000 ounces in production to the wage strike by the hard-line Association of Mineworkers and Construction Union (Amcu). Its headline earnings per share dropped to 60 cents, a fall of almost 90%.

"In our capital-constrained environment, we have decided that we will exit from the Union and Rustenburg mines, and our Pandora JV operation," Amplats said.

"There are a number of potential investors seeking access to the platinum industry and these are good long-life assets with potential that will provide them with that access."

Amplats parent Anglo American had already signaled its intention to reduce its troubled platinum portfolio.

A disposal is probably more palatable to the government and workforce than job cuts, which would have almost certainly been met by fierce political and union resistance.

The front runner to buy Amplats' mines is Sibanye Gold [JSE:SGL] , whose chief executive Neal Froneman told Reuters this month that he wanted a platinum deal before the end of the year and could easily raise $1bn.

But Froneman said he did not think any of the platinum mines Sibanye was looking at were "anywhere near" that price.

Analysts have said Amplats' five Rustenburg mines plus its Union mine could be worth between $1bn and $2bn.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For 14 free days, you can have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today. Thereafter you will be billed R75 per month. You can cancel anytime and if you cancel within 14 days you won't be billed. 
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders