[miningmx.com] – AN analyst at Johannesburg asset management company, Stanlib, planted the idea recently that although the South African government had formally rejected mines nationalisation as policy, a subtler expression of state interference had become practice.
This is, of course, a reference to the repeated government and union interference in restructuring activities of the publicly-listed Anglo American Platinum (Amplats).
The logic is that in allowing government to dictate the final shape of its restructuring plans, Amplats had granted the state a role in its affairs as if it owned it. As a stakeholder, the state has more influence over Amplats than shareholders who finance it. That has now been extended to unions.
So it is that Amplats agreed to adjust its restructuring plans a third time falling in with demands from the Association of Mineworkers & Construction Union (AMCU) to provide voluntary separation packages to employees identified for retrenchment, and replacing contractors with full-time employees.
The upshot is that Amplats’ restructuring will now eventually proceed, but the terms of the changes are a far cry from the plans first set down in the group’s year-long study, completed towards the end of 2012. For starters, it will continue to produce more platinum that it first felt was optimal in its own desktop study.
Here’s what Investec Securities said regarding the matter. “Again, AMS [Amplats] has had to back down due to demands from the unions and, in our opinion, has therefore demonstrated to shareholders that it is unable to make the changes that are needed to strengthen its business as it faces significant external pressures”.
This can’t be the kind of ‘conversation’ Anglo American CEO, Mark Cutifani, would prefer with the South African government; it doesn’t sound like the type of relationship he said on July 26 he’d endeavour to achieve: “We have to position the business for success in South Africa,” Cutifani said. “We have to change it for the better for both parties”.
For the rest of this column, click here: http://www.miningmx.com/page/opinion/columnists/1635538-Quo-vadis-Amplats-Griffith-Cutifani-s-Anglo#.Ul6IHlDVDus