Sibanye Gold Ltd. considering purchase of South Africa platinum mines after strike

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Rustenburg, South Africa Image credit: flickr User: James

Sibanye Gold Ltd. has announced that it plans to buy the platinum mines in South Africa once the strike over wages is resolved.

Rustenburg, South Africa Image credit: flickr User: James
Rustenburg, South Africa
Image credit: flickr User: James

According to the article on Bloomberg, Anglo American Platinum Ltd. (AMS), Impala Platinum Holdings Ltd. and Lonmin Plc (LMI) may be forced to sell some operations as a result of the workers’ strike that has crippled the mining sector and Sibanye Gold is up for the challenge.

Anglo American Platinum Ltd. (AMS), Impala Platinum Holdings Ltd. and Lonmin Plc (LMI) are top three biggest gold producers in the world.

Sibanye Gold Ltd. is the largest producer of gold in South Africa and one of the top ten largest gold producers in the world. The company operates the Kloof, Driefontein and Beatrix gold mines as well as various service companies. Formed in late 2012 by Gold Fields, Sibanye has thrived relative to its competitors, increasing share value to $9.14 a share in the last year.

“There’s nothing specific on the table right now, but we’re open to the idea” of buying platinum mines, some of which may go on sale after the strike,” James Wellsted, a spokesman for the company told Bloomberg.

Adertisement

“Our future is in South Africa and there’s a lot of potential to replicate what we’ve done with the Sibanye assets in the platinum sector. There aren’t really any obvious, value-accretive opportunities to acquire gold assets unless one of the bigger companies puts their South African mines up for sale.”

Anglo American Platinum CEO Chris Griffith revealed earlier this month that the company is considering whether it should keep its mines in South Africa’s Rustenburg area, with the Association of Mineworkers and Construction Union wanting the producers to more than double wages within three years.

So far, operators have offered increases of as much as 9%, bringing the situation to a standstill.