StrikeHit Amplats Warns of Restructuring

Strike-Hit Amplats Warns of Restructuring

The world's top platinum miner said its strike-hit Rustenburg and Union mines, in the country's northwestern and northern regions, were "in the most marginal financial position."

JOHANNESBURG, South Africa -- Mining giant Anglo American Platinum (IW 1000/763) warned today that the nearly month-long strike at its South African mines could lead to further restructuring, raising the specter of more job losses.

The world's top platinum miner said its strike-hit Rustenburg and Union mines, in the country's northwestern and northern regions, were "in the most marginal financial position."

"If the industrial action continues for much longer, we cannot rule out the need for further restructuring to ensure the long-term sustainability of those mines," spokeswoman Mpumi Sithole said.

The company did not specify what measures could be taken, but before the current strike the company had already announced job cuts running into the thousands.

The firm claimed the strike over wages, which started on Jan. 23, was costing about $92 million, or 4,000 ounces of platinum, each day.

Talks between the company and the Association of Mineworkers and Construction workers, which represents tens of thousands of striking workers, have so far failed to end the dispute.

Workers are demanding the doubling of their monthly wages to $1,125 and have so far rejected an initial offer of least 7% each of the next three years.

In an interview with Business Day newspaper, CEO Mark Cutifani raised concern about the future of Rustenburg mines.

"Until we get back to work and get the things up and running probably, I'm not sure they've got any future," he said. "It can only end badly for employees, and that's the thing that keeps me awake at night."

According to the newspaper, the struggling mines could be separately listed, folded into a black empowerment firm, or sold.

Still recovering from a crippling 2012 strike wave, the company last week reported a loss of 568 million rand ($51.2 million) from a loss of 6.4 billion rand in 2012.

Last year the company, which is 80% owned by British-South African group Anglo American, embarked on a massive restructuring scheme that affected around 7,000 jobs after initially eyeing double the cutbacks.

The firm later said it had reduced the retrenchments to 3,300, then announcing that the workers had instead been given voluntary separation packages.

Copyright Agence France-Presse, 2014

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