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Lonmin's 'bleeding' from mining strike

Tuesday, May 20, 2014 - 02:04

May 20 - With the strike at South Africa's platinum mines in its 17th week Lonmin's CEO talks to Reuters about the impact the strike is having on the company. As Sonia Legg reports, Lonmin has also reportedly dismissed 235 essential services workers who were on an unsanctioned strike.

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The platinum mining strike was already a high-stakes crisis - now Lonmin has raised the game even further. It's sacked 235 key employees - who'd been staging an unsanctioned strike. They work in essential services such as safety and underground maintenance. Under an agreement with the AMCU union they weren't supposed to take part in the industrial action. Their decision to do so led to legal action and now dismissal. It's a sign perhaps that after 17 weeks Lonmin is running out of patience. Ben Magara is Lonmin's Chief Executive. (SOUNDBITE) (English): BEN MAGARA, LONMIN'S CHIEF EXECUTIVE, SAYING: "Right now the company is bleeding, there will come a point where that bleeding means death, there will come a point when we will have to act on the business to safeguard the business." Lonmin says it has lost a third of its annual production due to the strike And it's been losing around $60 million a month - a figure it says is unsustainable and will lead to job losses. (SOUNDBITE) (English): BEN MAGARA, LONMIN'S CHIEF EXECUTIVE, SAYING: "The longer it goes on the more it is making restructuring inevitable so as we look right now our efforts are geared to finding a solution immediately so we can avoid the kind of damage we are seeing in our business so our priority is to bring back our employees with AMCU hand in hand." The strike has also hit Anglo American Platinum and Impala Platinum. And it's taken out 40% of global production and cost $1.8 billion overall. Since talks with unions broke down in April all three companies have taken their latest wage offer directly to the strikers. That's led to several workers being killed for trying to return to work. The AMCU has lowered its demands - but it's still a third more than the companies are offering. The latest sackings won't help - but Lonmin is clearly keen to show the strike can't go on indefinitely.

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Lonmin's 'bleeding' from mining strike

Tuesday, May 20, 2014 - 02:04