ANGLO American Platinum yesterday spelled out a major overhaul of its South African operations, involving the divestment of a mine complex and the closure of several shafts that could lead to 14,000 job losses.
As part of the review commissioned last February, Amplats will trim its Rustenburg operations into three mines, mothballing four high-cost shafts, resulting in a drop of 400,000 ounces of platinum output a year. Lower platinum demand and higher costs for the metal made the shafts unsustainable, Amplats said.
The miner, which is 80 per cent owned by parent Anglo American, also said it would divest of its Union operations, as the complex is “likely to be of greater value under different ownership”.
As a result of the overhaul, 14,000 jobs will be lost – of which around 13,000 will be in the Rustenburg area of South Africa – to balance the cuts, although the firm was hopeful of creating more jobs to counter the losses.
Amplats chief executive Chris Griffith conceded yesterday that there might be additional strikes in response to the job cuts, although he stressed that employees would go through a consultation period.
Overall, the outlined changes will deliver ZAR3.8bn (£270m) of annual benefits by 2015.
Griffith added that the review was designed to address the “structural changes” that have eroded profitability of Amplats over time.
Cailey Barker at Numis yesterday said the overhaul would have “positive implications for the platinum sector”.
Shares in Anglo American Platinum closed down 0.82 per cent yesterday.