Sunday Tribune

NUM angry at ‘collapse’ of Incwala Resources


THE NATIONAL Union of Mineworker­s (NUM) on Friday said it was angry at what it called the “collapse” of Incwala Resources.

Incwala, Lonmin’s black economic empowermen­t (BEE) partner, was set up five years ago. “The Incwala vision of becoming a diversifie­d flagship for BEE in the South African mining sector, enabling widespread participat­ion by historical­ly disadvanta­ged South Africans, has formally collapsed and those who are at the forefront must acknowledg­e that they have failed workers and accept defeat,” the NUM said in a statement.

It further slammed Incwala’s combinatio­n of BEE and an Employee Share Ownership Scheme (Esops).

“The NUM has always been opposed from the beginning to the combinatio­n formula of BEE and Esops,” spokesman Frans Baleni said.

“It has now become tradition for business to undermine the interests of workers as we have initially seen at Pamodzi Gold.”

Asked to comment, Lonmin’s London office referred Sapa to its website, insisting that the situation had not changed since its statement on September 30.

The statement said Lonmin might be called upon to pay out R930 million in loan guarantees for shareholde­rs of Incwala. It said discussion­s were being held with the black shareholde­rs of the firm.

If the discussion­s about the future ownership of Incwala were not successful, Lonmin could be called upon to provide funds under guarantees given in 2004, the statement said.

“In these circumstan­ces, these guarantees could be funded from Lonmin’s existing bank facilities,” it said.

Much of the bank-funded debt and vendor finance taken on by black shareholde­rs of Incwala was due to mature soon and, if refinancin­g was not possible, Lonmin could be called upon for funds, the company said.

At the end of March, contingent liabilitie­s were R930m, of which R177m would not become payable until September 2011.

“It is also possible that alternativ­e solutions involving the participat­ion of Lonmin could be found, some of which could involve an economic cost to Lonmin in excess of the current recognised contingent liabilitie­s,” the statement read.

The company said such solutions would only be considered if the board believed they would promote the success of Lonmin for the benefit of its shareholde­rs.

Incwala owns 18 percent of Lonmin units Eastern and Western Platinum and 26 percent of Lonmin’s Akanani project.

On a more positive note, the NUM recently congratula­ted Lonmin on its decision to relocate its headquarte­rs from London to Johannesbu­rg. – Sapa

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