The merger of Lonmin and Sibanye-Stillwater cleared another major hurdle last week when it got the go-ahead from the SA Competition Tribunal. But the deal is not yet done. Still needed is court approval in the UK to delist Lonmin from the London Stock Exchange, as well as votes of approval from shareholders in both companies. The tribunal’s clearance comes with a number of conditions, including, notably, a moratorium on retrenching employees for six months. With wages being Lonmin’s biggest expense, holding off on job cuts — up to 13,344 — may well add downside to the acquisition of an already risky company.

The Lonmin share price has largely been tracking Sibanye’s since the merger plan was announced in December. The merger approval last week pushed Lonmin’s share price up 3.3% the next day, while Sibanye’s dropped 4.7%. However, industry analysts say the tribunal’s decision is the best outcome for all concerned. "From our perspective it’s the better outcome for the majority ...

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