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Amplats closes shafts, 14 000 jobs to go

Jan 15 2013 08:49 Reuters
Amplats worker

Amplats (Picture: AFP)

Company Data

ANGLO AMERICAN PLC [JSE:AGL]

Last traded 235.75
Change -3.11
% Change -0.01
Cumulative volume 1632926
Market cap 331.34bn

Last Updated: 23/10/2014 at 04:27. Prices are delayed by 15 minutes. Source: McGregor BFA

Anglo American Plat Ltd [JSE:AMS]

Last traded 362.74
Change -0.76
% Change 0.00
Cumulative volume 169929
Market cap 97.82bn

Last Updated: 23/10/2014 at 04:27. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - Anglo Platinum [JSE:AMS], the world's top platinum producer, said it will indefinitely close four of its shafts in South Africa's platinum belt and sell its Union mine, as part of a sweeping reorganisation of its struggling business. 

The company also said in a strategic review released on Tuesday the reshuffle will lead to 14 000 job cuts, which it hopes to eventually replace with a similar number of new positions. 

The review, seen as crucial to the flagging fortunes of Anglo American [JSE:AGL], which owns about 80% of Amplats, had widely been expected to lead to at least some shaft closures due to soaring costs and falling profits.

Amplats said on Monday it likely fell to a full-year loss because of costly strikes.

But closures could risk a new wave of labour unrest, with the militant Association of Mineworkers and Construction Union threatening to close operations like it did last year if the review leads to shutdowns and job losses.

Amplats said it would "divest the union mines at the right time - to maximise value under different ownership". Reuters reported on Monday Amplats was likely to sell Union. 

"Four unsustainable, high-cost shafts, namely Khuseleka 1 and 2 and Khomanani 1 and 2, will be put on long-term care and maintenance," it said.

As a result, about 400 000 ounces would be taken out of its production profile, which could help the price of the white metal, which hit a three-month high on Tuesday on South African supply concerns. 

Shares of Amplats were flat in early trade on Tuesday, dipping in and out of negative territory as investors digested news the platinum producer would indefinitely close four of its South Africa shafts and sell its Union mine. 

Amplats was up 0.6% at R493.98 at 07:08 GMT, compared to a 0.14% rise in the benchmark Top 40 - (Tradeable) [JSE:J200] index.

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amcu  |  anglo platinum  |  mining  |  platinum
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