Lonmin appeals to staff as 44 die in violence at mine

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The Independent Online

Lonmin last night appealed to its striking staff to come back to work in the aftermath of the escalation of the violence at its Marikana mine in South Africa that pushed the death toll to 44 in the past week.

The wildcat strike over pay by 3,000 workers had already claimed 10 lives amid clashes between rival unions before South African police opened fire on machete-wielding strikers on Thursday, killing a further 34 people.

Lonmin's shares continued their descent yesterday, ending the day 8.5p lower at 639.5p and bringing their total decline to 15 per cent – or about £200m – since the strike began last Friday. About half of the share price decline came on Thursday, as Lonmin was forced to issue a profits warning on the back of the turmoil, saying that the disruptions at Marikana had cost it about 15,000 ounces of platinum production. The company is now likely to miss its target of 750,000 ounces for the year.

As the situation at the mine, about 65 miles north-west of Johannesburg, appeared to be calming down yesterday, Lonmin warned those workers on strike they risked causing widespread damage to South Africa's reputation.

Simon Scott, Lonmin's chief financial officer, said: "A stable mining sector is vital to the economic future of this country. If the industry continues to be damaged by illegal actions it is not just the economy that suffers, but all our employees, their families and dependents.

"We need our employees to come back to work and we need to get mining again," Mr Scott added, before expressing his "sincere condolences to the families and friends of all those employees who have lost their lives".

Furthermore, Mr Scott pledged to do everything he could to mend relationships with staff, unions and local communities. "We must start to rebuild those relationships, starting today, building back trust and trying to move forwards," he said.

The company also raised concerns it might struggle with its debts, saying it would be closely monitoring its borrowings in the light of the disruptions.

Meanwhile, compounding Lonmin's problems further, its chief executive Ian Farmer was this week diagnosed with a serious illness and taken to hospital, leaving the company in the hands of chairman Roger Phillimore.