March 25 (Reuters) - Lonmin Plc, which is being bought by Sibanye-Stillwater, said it does not have sufficient liquidity to fund the new projects needed to avoid shaft closures and job losses.
The London-listed miner, crippled by soaring costs and subdued platinum prices, has been cutting spending to conserve cash and retain a positive cash balance, one of the conditions upon which South Africa-based Sibanye’s takeover is contingent.
The all-share deal, which is valued at 285 million pounds ($361 million) was likely to lead to more than 10,000 layoffs, the companies warned earlier. Lonmin said on Monday it has reduced over 8,000 positions as part of its business improvement plan.
“Despite these achievements we continue to be financially constrained and unable to fund the significant investment required to sustain our business and associated employment in the future,” Lonmin said in a statement ahead of its AGM.
“The challenges facing Lonmin and the industry persist,” Lonmin added.
Reporting by Justin George Varghese in Bengaluru; editing by Louise Heavens