Sibanye-Stillwater will have to wait longer for the conclusion of the long overdue all-share takeover of Lonmin following an eleventh hour appeal filed by the Association of Mineworkers and Construction Union (Amcu) against the Competition Tribunal’s approval of the Sibanye-Lonmin transaction.
Last November, Sibanye-Stillwater’s all-share takeover bid for Lonmin was approved by South Africa’s Competition Tribunal but the green light was fiercely contested by Amcu, who argued that thousands of jobs were on the line with the looming deal. Amcu’s contempt was fuelled by initial revelations from both Sibanye and Lonmin in 2017 which disclosed that over 12 600 jobs were on the line in the near to mid term.
In retaliation, the 15 000-strong miner’s union filed an appeal with the Competition Appeal Court of South Africa against the South African Competition Tribunal’s November 21, 2018 decision to approve Sibanye’s offer subject to specific conditions. Part of the stringent conditions for the takeover, the tribunal levied a six-month moratorium on retrenchment noting that the merger involved “massive public interest issues involving extensive job losses and impact in the platinum mining region of the North West”.
However, James Wellsted, head of Investor Relations at Sibanye-Stillwater, reiterates: “Initially, Lonmin indicated that due to the necessary closure of old mines running generation one shafts, there were 12 600 jobs that would be lost. But that is separate from the transaction. We (Sibanye-Stillwater) indicated that as a result of the merger, 890 jobs could be affected. Amcu disagreed with that and the union thinks all the job losses are linked to the takeover.”
With the initial February 28 longstop date fast approaching and Amcu’s appeal at the competition appeal court still in process, both Sibanye-Stillwater and Lonmin have agreed to extend the longstop offer.
A statement released by Lonmin reads: “In light of the appeal before the competition appeal court, Sibanye-Stillwater and Lonmin have agreed, with the consent of the panel, to extend the longstop date for the scheme to become unconditional and effective from February 28 to June 30. Sibanye-Stillwater and Lonmin remain fully committed to the offer.”
Meanwhile, the extension comes amid an Amcu member strike at Sibanye-Stillwater’s gold mines that is set to spill over to Sibanye’s platinum mines this week as miners demand a higher wage offer. Wellsted says: “The strikes shouldn’t have an impact on the transaction. The strikes have been taking place at our gold operations and Amcu only gave notice yesterday that they intend to have a sympathy strike at the platinum mines but this will not affect the transaction in anyway.”