Lonmin to sell surplus platinum capacity to raise cash

The measures are in response to a subdued South African economy and inflationary pressures on the platinum mining industry, the company said on Monday.

FILE: The main entrance of the Lonmin platinum mine in Marikana. Picture: AFP

JOHANNESBURG – Platinum miner Lonmin Plc said it would cut costs and monetise select assets, including the sale of excess processing capacity of up to 500,000 platinum ounces per year, to maximise cash from processing operations and preserve cash.

The measures are in response to a subdued South African economy and inflationary pressures on the platinum mining industry, the company said on Monday.

Lonmin said its current cash position made it hard to sustain capital expenditure into its Rowland unit, and that it would look for funding partners and “preserve” about 5,000 jobs.

The company also said it planned to reduce annual overhead costs by at least R500 million by 30 September 2018 through right-sizing of operations.