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SARB approves Sibanye-Lonmin merger

May 15 2018 12:12
Marelise van der Merwe

The merger between Sibanye-Stillwater  [JSE:SGL] and Lonmin [JSE:LON] has been approved by the South African Reserve Bank (SARB).

However, the transaction was still subject to approval by some regulators, both companies said in separate notes to shareholders.

“We are pleased that Sibanye-Stillwater has the approval of the South African Reserve Bank for the proposed transaction. Lonmin is working closely with Sibanye-Stillwater towards completing the proposed transaction during the second half of the year as planned," said Lonmin CEO Ben Magara.

"Lonmin remains committed to its strategy of focusing on operational performance, controlling costs and preserving cash."

The transaction remains subject to approvals of the competition authorities of the United Kingdom and South Africa, as well as the passing of required resolutions by Lonmin and Sibanye-Stillwater shareholders, the companies said.

Sibanye-Stillwater CEO Neil Froneman said the approval takes his company "another step closer to concluding this important transaction".

Management remains focused on ensuring that the remaining conditions are met and will notify stakeholders as further progress is made, he said.

On Monday, Fin24 reported that unless the transaction between Lonmin and Sibanye-Stillwater was completed soon, platinum miner Lonmin would need to retrench some 12 600 workers between 2018 and 2020. Some 2 000 jobs have already been lost, and a further 1 700 are expected to be lost during the remainder of 2018.

Around 5 300 retrenchments are expected in 2019 and 3 600 are expected in 2020.

According to Magara, job losses are primarily due to either redundancy or the shutdown of shafts.

He added that in view of the strengthening of the exchange rate, additional job losses could even be accelerated by delays in the transaction.

The submission by Sibanye-Stillwater, to consider the proposed transaction, was filed to the Competition Commission in March.

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