The UK’s Competition and Markets Authority (CMA) has launched an investigation into South African firm Sibanye-Stillwater’s planned acquisition of Lonmin.
The CMA will examine whether the transaction would reduce competition within any UK market for goods or services.
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The deadline for the first phase of the CMA decision is set for 10 July and the public can submit their comments on the transaction until 29 May.
Last December, Sibanye-Stillwater entered an agreement to acquire cash-strapped miner Lonmin for £285m.
The transaction has been approved by the South African Reserve Bank.
Sibanye-Stillwater CEO Neal Froneman said: “We are pleased to have received this important regulatory approval in a timely manner, which takes us another step closer to concluding this important transaction.
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By GlobalData“Management remains focused on ensuring that the remaining conditions are met and will notify stakeholders as further progress is made.”
The transaction is expected to be completed during the second calendar half of this year.
Shore Capital analyst Yuen Low was quoted by Reuters as saying: “The longer the delay, the greater the potential for transaction failure, since the likelier it would be that Lonmin would be in net debt.
“Even supposing the CMA approved the transaction, there could be delays to the transaction.”
For the first six months ending in March, Lonmin cut its operating loss to $32m from $181m last year.
The company plans to lay off 3,700 jobs in this financial year in response to weak global platinum metal prices and rising operating costs.
