Anglo American Platinum’s wholly-owned subsidiary Rustenburg Platinum Mines (“RPM”) has today commenced a consultation process in terms of section 189 and 189A of the Labour Relations Act on the proposed restructuring of its Union Mine joint venture and the Twickenham Project.

As set out in the Company’s 2015 Annual Results announcement on 8 February 2016, Anglo American Platinum continues to manage its business for the current commodity pricing environment. At Union mine, there have already been significant restructuring efforts to reduce overhead and operating costs and ensure the sustainability of the mine. During 2014, the Union north and south mines were consolidated into one mine, and in 2015 the Union south declines closed, reducing annual production capacity by 80koz to 140 koz.

Anglo American Platinum also reported that it has delayed all expansionary Project decisions until at least 2017. As a result of this development, the Twickenham Project was suspended in 2015 and the operation restructured to reduce cash losses, including placing one of its two shafts on care and maintenance and reducing the number of independent contractors. However, the Twickenham Project continued to make a substantial cash loss in 2015 and such losses cannot be sustained by the Company.

Despite these considerable changes, the economic outlook remains uncertain and further intervention is necessary to ensure a sustainable long term outlook for Anglo American Platinum and all its stakeholders. Having considered a number of alternative options, the Company is proposing to undertake a further restructuring process at Union Mine in order to ensure that the operation is both cash positive and sustainable and has resolved to place Twickenham Project on care and maintenance.

This proposed restructuring of Union Mine is necessary irrespective of whether or not a sale of the operation takes place in due course.

The Company expects approximately 2,000 jobs in total to be impacted by the proposed restructuring at Twickenham and Union Mine. The final number will be determined after the consultation process. A number of retrenchment avoidance measures will be undertaken in an attempt to reduce the number of impacted individuals, including offers of voluntary severance packages, early retirement and opportunities for redeployment across the Company.

The Section 189 process involves a 60 day consultation period with trade unions and affected employees, facilitated by the Commission for Conciliation, Mediation and Arbitration (CCMA), and only when concluded will the final number of impacted jobs be known.

Ian Botha, Financial Director of Anglo American Platinum, said “Anglo American Platinum has no choice but to manage the business for the current environment and we need to take decisive action to ensure the sustainability of the business. Having considered all alternative options, it is with regret that the Company finds itself in a position where further restructuring now needs to take place, which will impact a number of our employees. We will continue to engage with our key stakeholders and work together to find the best possible solutions for those who will ultimately be impacted.”