Mines strike action takes shine off Exxaro shares

THE STRIKE action at Exxaro Resources’ Grootegeluk Coal Mine in Lephalale and Leeuwpan Coal Mine in Delmas sank the miner’s shares more than 5 percent, the most in three months.

The mineworkers’ strike stems from wage increase demands by the National Union of Mineworkers (NUM) where the union is demanding a raise of 10percent.

NUM deputy general secretary William Mabapa confirmed that the strike had started yesterday morning.

Mabapa said: “The union demands a wage increase of 10 percent, service increment of 0.5 percent that is given to other employees and denied to other employees, housing increase of 10 percent or R5 000, a standby allowance of 10 percent, family responsibility leave of eight days, and a long-service award of 15 years with one Krugerrand.”

Exxaro also confirmed that NUM had obtained a strike certificate and had given notice of their intention to embark on strike action from 6am yesterday.

Exxaro executive head: stakeholder affairs, Mzila Mthenjane, said: “We’ve noted the decision by NUM to issue a strike notice.

“We continue discussions with NUM in order to resolve and reach an agreement sooner to minimise the impact on employees”.

Mthenjane said negotiations with Solidarity – the other trade union recognised for collective bargaining – were continuing as they had not declared a dispute.

He said NUM and the JSElisted mining company had agreed to meet today to continue with negotiations.

The black-empowered diversified mining company supplies state-owned power utility Eskom, other domestic markets as well as the export markets. The strike is expected to have a significant impact on the companies’ supply to Eskom and its various markets.

Among mining stocks, Impala Platinum dropped 7.45percent, Sibanye Gold declined 4.03 percent, Lonmin fell 3.58 percent.

NUM said it had submitted wage demands on April 13 and engaged with the company until September 6.

Exxaro shares plunged 5.10 percent on the JSE yesterday to close at R119.