Shares in struggling South African platinum producer Lonmin (LON:LMI) climbed Wednesday after the South African Competition Tribunal approved the company’s takeover by Sibanye-Stillwater (JSE:SGL) (NYSE:SBGL), with conditions
By late afternoon, Lonmin had climbed 8% to 48.12p, while Sibanye was slightly up in New York at $2.74 as the regulator imposed as condition a moratorium on planned layoffs at Lonmin operations for a period of six months from the implementation date.
The requisite adds to others the Competition Commission imposed in September. One of them forces Sibanye to embark on three short-term mining projects to avoid the loss of over 3,000 jobs, subject to platinum prices rising and costs being kept low.
Sibanye-Stillwater chief executive Neal Froneman said the company believed the terms of the approval were “fair, reasonable and in the best interest of all stakeholders.”
The 285-million pound deal (about $364 million), still subject to shareholders vote, would create the world’s No.2 platinum producer. Lonmin already is the world’s third-largest while Sibanye-Stillwater is the fourth.