Amplats breaks 8-week strike with new offer

[] – ANGLO American Platinum (Amplats) could end a miserable week for its parent company, Anglo American, with good news after a report said Amplats’ workers had accepted a new pay deal ending weeks of acrimonious, and often violent, strikes.

Shares in Anglo American have been pounded after it announced its Minas Rio iron ore mine in Brazil faced another capital expenditure overrun taking total investment in the mine to R14bn, and making it the most expensive iron ore mine per tonne of metal produced.

Meanwhile, its top contributor to pretax earnings in the last financial year, Kumba Iron Ore, said earnings would be at least a fifth lower year-on-year owing to output interruptions and lower mineral prices globally.

According to Reuters, however, the eight-week strike at Amplats’ operations could draw to an end as early as Thursday (November 15). Amplats had announced earlier on November 14 that earnings would also be at least a fifth lower.

Citing a company spokesperson, Reuters said the strike committee, an entity without specific union affiliations but which had been handling negotiations at certain Amplats operations “.. are happy with the revised offer”.

“Indications are that the strike committee members are happy with the revised offer. They will today (November 14) present the offer to their members and encourage them to return to work tomorrow,” Amplats’ Mpumi Sithole told Reuters.

Strikers in South Africa had rejected Amplats’ earlier revised offer which included a R4,500 one-off payment and a pledge to start wage talks ahead of the expiry of current deals next year, said Reuters.

Sithole said that in addition, the company has offered to pay each qualifying employee either an additional monthly allowance of R600 or a monthly salary increase of R400.

The strikes have cost Amplats close to 170,000 ounces in lost platinum production which would fetch around $250m at current spot prices, Reuters said.