• Caught in the debt trap?

    Help us help you by taking our second annual Debt survey and you could win R3 000.

  • Rich man, poor man

    Culture change from below is the only way to overcome poverty, says Leopold Scholtz.

  • Tech bubble talk

    After the tech euphoria of 2013, the fast-moving sector has hit a speed bump.

Data provided by McGregor BFA
All data is delayed
Loading...
See More

Lonmin eyes $800m in rights issue

Oct 30 2012 09:41 Reuters

Company Data

Lonmin plc [JSE:LON]

Last traded 51.27
Change -0.74
% Change -0.01
Cumulative volume 506790
Market cap 29.15bn

Last Updated: 24/04/2014 at 04:17. Prices are delayed by 15 minutes. Source: McGregor BFA

Related Articles

Lonmin denies claims of govt collusion

New work stoppage hits Marikana

Lonmin operations return to normal

Lonmin wage bill to rise by 14%

Lonmin deal not lasting solution, MPs told

Expert: Lonmin strikers scored

 

London - Strike-hit South African miner Lonmin [JSE:LON] said it planned to raise $800m in a rights issue and had signed amendments to its debt facilities to help it avoid a possible covenant breach next year.

Lonmin, the world’s third-largest platinum miner, which has one of the most pressured balance sheets in the sector, had warned that it may need to issue new shares to help shore up its finances after a deadly strike hit output.

The company said that the proposed rights issue was underpinned by a standby underwriting agreement and that it had also amended a deal with its lenders to remove earnings-related covenants.

Analysts had raised concerns that the company could breach such covenants at the latest test but Lonmin said on Tuesday that it did not expect to do so, although it warned had it not taken action there was a danger over the March test.

“With the standby underwriting and amended debt facilities signed we have taken two decisive steps on our way to delivering that and we are confident about our financial security,” chaiperson Roger Phillimore said in a statement.

Lonmin’s Johannesburg-listed shares were down 1.8% at 07:39 GMT, paring earlier gains of as much as 4%.

The company said that production slumped 45.7% in the three months to September 30. It had already warned that it would miss its 2012 output target after a strike left 44 dead in August.

South African mines have been hit by months of labour unrest which have threatened growth in Africa’s biggest economy and drawn criticism of President Jacob Zuma for his handling of the most damaging strikes since the end of apartheid in 1994.

Lonmin’s miners have since returned to work and the company said that the ramp up in production was going better than expected.

Lonmin shares fell more than 5% in early trade following news of the rights issue.

At 07:08 GMT, Lonmin shares were down 4.76% to R64, after earlier hitting a record low of R63.


lonmin  |  rights issue
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
3 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're Talking About: Small Business

Standard Bank is looking for 12 entrepreneurs to participate in a 10-part TV series. They could win a R1m investment into their dream.
 
 

Fewer high-risk election areas - Mthethwa

There are fewer high-risk election areas this year compared to past elections, Police Minister Nathi Mthethwa has said while visiting Manenberg in Cape Town.

 
 

Latest elections multimedia

Watch what happened when we blindfolded Helen Zille and asked her to eat random things
13 days to elections - news you need to know
11 Julius Malema quotes you'll never forget
DA won't get 30% - Zille

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...