Reuters logo
UPDATE 2-Lonmin picks Amplats executive to lead turnaround
April 2, 2013 / 11:46 AM / 4 years ago

UPDATE 2-Lonmin picks Amplats executive to lead turnaround

* Lonmin has been rebounding from deadly 2012 strikes

* New CEO seen good fit, understands changed mining sector

* Lonmin is world’s third-largest platinum producer

* Killing of 34 strikers by police at Marikana rocked nation

By Ed Stoddard

JOHANNESBURG, April 2 (Reuters) - South African platinum producer Lonmin PLC appointed Anglo American Platinum (Amplats) executive Ben Magara as its new chief executive on Tuesday as it strives to rebound from a wave of deadly strikes which hammered it last year.

Magara, who will start in July, will be tasked with guiding Lonmin’s turnaround and improving industrial relations at the company after illegal strikes last year triggered violence which killed 46 people, including 34 strikers shot dead by police in a single day at its Marikana mine.

A Zimbabwean national who ran Anglo America’s South African coal operations before taking over engineering and capital projects at Amplats, Magara faces a militant labour force which closed Marikana for a day last month, embarrassing Lonmin as it hosted a media tour.

Industry sources say he has invaluable experience of South Africa’s highly-charged labour and political environment, in which mining executives do not have just investors to please.

“He seems to get - more than almost anyone else - that the mining game has changed and that your stakeholders are as important as your shareholders,” said a senior lawyer who has worked with Magara.

“For a company like Lonmin, that doesn’t seem to have that institutional nous, this is a great hire,” the lawyer said.

South Africa’s mining landscape has been radically transformed by the emergence of the militant Association of Mineworkers and Construction Union, which has poached members from the once dominant National Union of Mineworkers in a bloody turf war that was at the root of last year’s violence.

The government and the ruling African National Congress also have the mining industry under a microscope and have lashed out at plans by Lonmin rival Amplats, the world’s biggest platinum producer, to cut up to 14,000 jobs to restore profits.

Lonmin had been searching for a new chief executive since the end of last year, when Ian Farmer officially stepped aside due to illness.

The company has been recovering and in January said production in the last three months of 2012 bounced back more strongly than expected from crippling strikes.

Platinum, used in catalytic converters in cars, has come under pressure since the global economic downturn.

The strikes, weak platinum prices and high costs forced Lonmin to turn to investors in November to raise $817 million to avoid breaching lending terms.

Lonmin said Simon Scott, who has been acting chief executive since August 2012, will resume his role as chief financial officer when Magara joins.

Lonmin’s shares in London were down 0.5 percent at midday.

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below