Anglo American to divest South African Rustenburg mines

15 April 2014 (Last Updated April 15th, 2014 18:30)

Mining and natural resources company Anglo American (Amplats) is set to divest its unprofitable South African Rustenburg mines.

Mining and natural resources company Anglo American (Amplats) is set to divest its unprofitable South African Rustenburg mines.

The company is seeking a buyer for its Rustenburg platinum mines as part of its long-term strategy to focus on open cast extraction.

Amplats is the world's largest primary producer of platinum. The company has said that its Rustenburg mines may not make a profit this year, due to a series of workers strike that incurred about $1bn of losses in costs and damages.

Amplats is an 80%-owned Anglo subsidiary and is operating the mines under consideration.

"Rustenburg mines may not make a profit this year, due to a series of workers strike that incurred about $1bn of losses in costs and damages."

The company intends to focus on the open cast operation Mogalakwena mine in Limpopo, which can be expanded from its existing output of 330,000oz to 420,000oz of platinum.

About 80,000 miners are said to be on strike, demanding an increase of their minimum monthly wage and have vowed not to return to the shafts until their demands are fulfilled.

Attempts made by the government to settle the dispute between the Association of Mineworkers Construction Union (AMCU) and mine management have also failed.

The company employs 100,000 staff worldwide at present and said it has previously cut 7,500 jobs in the Rustenburg area in a bid to restore those mines to profit, but the strike has led to further losses for the company.

In 2012, the company initially planned to slash 14,000 jobs but scaled back the cuts to 6,000 under a revised business proposal, following pressure from the government and unions.

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