It's no fire sale, says Lonmin's Magara
Upbeat CEO says move will make company more viable
Beleaguered platinum miner Lonmin is buying itself some breathing space in the hope that this will be the last year that the platinum price languishes. It is in talks with prospective buyers for some of its assets to raise much-needed funds; this, after the market feared that it would have to do a fourth rights issue to raise more capital. Lonmin CEO Ben Magara said this week that it was not a fire sale of company assets, because the company was net cash-positive. Rather, it was a decision to further reduce costs and improve liquidity for the business. "We believe we have real opportunity, in selling a portion of our downstream capacity. There are many juniors who do not have a processing facility and this is an opportunity for them," Magara said. The processing plant has the capacity to process about 1.2 million platinum ounces a year, but Lonmin was producing only about 600,000 to 700,000 platinum ounces, meaning there was available capacity for another miner. The company also pla...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.