adminplatinum miner, has given workers at its Marikana mine an ultimatum to return to work yesterday or face being fired.
Management said just over a quarter of workers had returned yesterday. “Attendance has started slowly but is now up to 27 percent. But it is unclear if the striking workers are returning,” a Lonmin spokesperson told Reuters.
Police spokesman Dennis Adriao said there had been no reported incidents yesterday morning. “There is a high police presence and visibility,” he said.
Media were initially turned away at the entrances to the mine. Police officials told journalists that they were under instructions not to allow media entry to the premises, which was private property.
President Jacob Zuma appointed a high-level ministerial committee to visit the area yesterday to help families of the victims.
The committee consists of 10 Cabinet ministers, led by Minister in the Presidency Collins Chabane.
Ministers met at the local councillor’s offices in Rustenburg yesterday morning and were set to make their way to Marikana later in the day.
Yesterday morning, Congress of the People leader Mosiuoa Lekota and United Democratic Movement president Bantu Holomisa were at the mine and were set to address workers later.
Already battered by rising costs and feeble prices squeezing the platinum industry, Lonmin shares have fallen to their lowest levels since 2008 as a result of the union clashes.
Yesterday, its shares were down 3,61 percent at 80,29 rand in Johannesburg.
Lonmin has one of the most pressured balance sheets in the sector and analysts have warned for days that the latest stoppage — which means the miner will miss its 2012 output target — will force it to overhaul its debt and potentially raise cash on the equity market. The Sunday Times newspaper in London said the miner’s expected rights issue could be as large as US$1 billion, roughly half its current market capitalisation. Sources familiar with the matter told Reuters it was too soon to put a figure on a cash call, as production had yet to resume at the mine.
Analysts at Liberum in London said a US$1 billion cash call would be the “belt and braces” recapitalisation needed, given industry oversupply and market conditions that have made large chunks of production unprofitable. “A US$1 billion rights issue, as compared with its current US$2 billion market cap, will be a difficult proposition, but strategically, could provide a longer-term benefit,” Nomura analysts said in a yesterday note.
“However, with such an uncertain future we continue to see the share price as too high and reiterate our ‘reduce’ recommendation.” Deutsche Bank cut its recommendation on the stock to “sell” from “hold”.
Lonmin also had yet to receive a firm commitment of support in the event of a rights issue from its largest shareholder, miner Xstrata, the sources said. — Reuters.
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