Sibanye: US firm files class action suit

Sibanye-Stillwater’s share price has plummeted more than 75% in the past 16 months and the troubled miner now faces potential class action from a number of US law firms.

US-based law firm Bernstein Liebhard announced on Thursday that it had filed a securities class action lawsuit on behalf of those who had purchased or acquired the securities of Sibanye Gold Limited (the legal name of Sibanye-Stillwater) between April 7 2017 and Tuesday this week.

Over this period the company’s share price dropped from R34 a share to R8.33.

The share was particularly hit on Tuesday when yet another employee died at a SibanyeStillwater mine, bringing the number of fatalities at the company to 21 in 2018.

Despite the filing of the lawsuit the share price closed 2.3% higher on Thursday.

After filing a class action it must then be certified by a US court. If it is not certified, the case is dismissed.

Director of mining at Cadiz Corporate Solutions, Peter Major, warned threats of a class action were not to be disregarded. “That’s a dominant industry in the US, so yes, best to take it seriously and put that brushfire out with a sledgehammer, fast,” he said.

In a statement Bernstein Liebhard said that, according to its lawsuit, throughout the period in question SibanyeStillwater had made false “and/or” misleading statements “and/or” failed to disclose that “its company culture places short-term profits over safety”. Consequently, almost half of

21

SA’s 2018 mining fatalities occurred in Sibanye mines and so Sibanye-Stillwater’s statements about its business, operations and prospects were “materially false and misleading and/or lacked a reasonable basis at all relevant times”, the firm said.

Tuesday’s fatality has attracted the attention of other legal firms that specialise in class actions.

Bronstein, Gewirtz & Grossman on Wednesday announced that it would investigate potential claims against Sibanye Gold on behalf of investors.

In a notice the law firm said that the investigation concerned whether Sibanye and certain of its officers or directors had violated US federal securities law and called on anyone who had purchased shares or who had information relating to its probe to make contact.

Sibanye-Stillwater shares trade in the US in the form of American depositary receipts and in turn are subject to US federal securities laws.

In a statement SibanyeStillwater said that it noted the announcement by “various law firms” in the US “threatening possible class action lawsuits against the company”.

The company said that it would vigorously defend itself “if any claims are ultimately filed against the company”.

Also on Thursday the UK’s Competition and Markets Authority cleared SibanyeStillwater’s proposed acquisition of Lonmin.

The offer remains subject to approvals from the South African competition authorities, shareholders and the courts of England and Wales, where Lonmin is registered.

the number of SibanyeStillwater employees who have died in 2018