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
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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