Under pressure Lonmin resorts to selling future growth assets
Lonmin has its back to the wall financially and is now resorting to selling future growth assets as well as looking for partners at key projects in a strategy designed to bring cash into the company and take strain off its balance sheet, instead of waiting for a more favourable platinum market. Lonmin — one of the world’s leading sources of platinum group metals (PGMs) — reported a much improved third quarter of its financial year-end to September. It had a difficult first half and came relatively close to breaching a debt covenant. Lonmin has already cut 6,000 jobs, reducing its workforce to about 32,000 people as it stopped and closed unprofitable old shafts to focus on its newer mines. On Monday, it released a fresh plan to the market, showing how it would expedite two key projects that would otherwise have been delayed if it waited for improved platinum prices. "Each of the measures announced … imply that Lonmin can continue to find incremental levers to shore up the cash balanc...
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