Northam Platinum Slumps on Strike Ultimatum: Johannesburg Mover
Northam Platinum Ltd. (NHM) fell the most in almost seven months in Johannesburg trading after giving striking workers until tomorrow to report for duty or face potential dismissal.
The shares dropped as much as 6.7 percent, the biggest intraday decline since Sept. 21, and traded down 5.8 percent at 32.30 rand as of 4:36 p.m. local time.
Workers at South Africa’s Zondereinde mine face disciplinary action including possible dismissal if they don’t return to work by the morning, Memory Johnstone, a spokeswoman for the Johannesburg-based company, said in an e-mail.
Rock drillers at the mine, located on the western limb of the platinum-rich Bushveld Complex, walked out on April 2 in a protest over pay and bonuses. The strike echoes labor action across South Africa’s platinum industry in 2012, which led to mine shutdowns and wage increases of as much as 22 percent.
“The whole modus operandi and the way the thing is playing out is similar to last year,” said Michael Kavanagh, a Cape Town-based metals and mining analyst at Noah Capital Markets. “It’s going to be interesting how this one plays out, bearing in mind upcoming wage discussions.”
Most platinum miners belonging to South Africa’s Chamber of Mines have wage agreements expiring at the end of June, Elize Strydom, the chamber’s chief negotiator, said in an e-mail.
Northam has lost 12,500 ounces of platinum group metals and 143 million rand ($15.6 million) during the unauthorized strike, the company said in a statement yesterday.
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