Belfast Telegraph

Miner Lonmin to be taken over in £285 million deal

London-listed Lonmin, also based in South Africa, said the offer provides a “comprehensive and sustainable” solution to the adverse challenges it faces.

Platinum miner Lonmin has agreed to a takeover by South African rival Sibanye-Stillwater in a £285 million deal.

London-listed Lonmin, also based in South Africa, said the offer provides a “comprehensive and sustainable” solution to the adverse challenges it faces.

“The combination of Sibanye-Stillwater and Lonmin creates a larger and more resilient company, with greater geographical and commodity diversification, that is better able to withstand short-term commodity price and foreign exchange volatility,” the firm said in a stock exchange announcement.

Shares in Lonmin rose over 20% to 76p in morning trading following the news.

Sibanye estimates that the deal will result in £80 million in cost savings by 2021 and a headcount reduction of approximately 700 staff.

Lonmin shareholders will receive 0.967 new Sibanye shares for each Lonmin share.

The transaction values Lonmin at 86.3p a share, a 35% premium on the firm’s closing price of 63.8p on December 13.

If the deal goes ahead, Lonmin shareholders will hold approximately 11.3% of the new entity and Sibanye shareholders will hold 88.7%.

Sibanye is South African’s biggest gold producer and also operates mines and projects in Zimbabwe and the United States.

Lonmin is a major mine-to-market producer of platinum, with its core operations in South Africa and assets worth over $2 billion.

It produces platinum predominantly used in industrial applications as well as in jewellery and investment, with by-products including gold, copper, nickel, chrome and cobalt.