Lonmin Loses CEO as Shares Fall and Employees Fight

21 October 2009 (Last Updated October 21st, 2009 18:30)

South Africa’s National Union of Mineworkers (NUM) has rejected Lonmin's wage increase proposal of 6.5% following news its chief executive Alan Ferguson is stepping down. Lonmin increased its offer to 6.5% from the initial 5% as shares fell given news its CEO would step down due to the

South Africa’s National Union of Mineworkers (NUM) has rejected Lonmin's wage increase proposal of 6.5% following news its chief executive Alan Ferguson is stepping down.

Lonmin increased its offer to 6.5% from the initial 5% as shares fell given news its CEO would step down due to the relocation of its head office to Johannesburg.

Following the proposal, NUM decreased its initial demand from 25% to 20%.

NUM‘s chief negotiator at Lonmin, Eric Gcilitshana, warned that non compliance with their demands could lead to a “serious conflict”.

It is bad news for Lonmin, which recently announced a drop in sales which battered its share price.

Lonmin recorded a drop in platinum sales of 25% in the fourth quarter and warned that miners in South Africa dealing with precious metals are unlikely to face better times in the year ahead.

Platinum sales for the full year have dropped 6%.