Shareholder activist Theo Botha has welcomed the commitment by the Lonmin board to “reflect on the comments made by all the shareholders during the rights issue process” and he intended questioning the board as to whether it failed to exercise its duty of care and skill in the period leading up to the disaster at Marikana and in the days after.
Botha will be attending the company’s general meeting of shareholders today, which has been called to vote on the proposed $817 million (R67.2 billion) rights issue.
At the meeting, held in London, Botha wants the chairman to explain the management’s decision to demand, in the days following the killing of 34 striking miners in a confrontation with the police, that the strikers return to work.
He also wants an explanation for the management’s decision to say absolutely nothing for five days after the tragic events. “I understand the chairman of the company was in the country on August 14 when eight people were killed and flew out on August 16 when (more) people were killed. If he was here why did he leave?,” Botha asked.
“Surely it was incumbent on him to stay, especially as the chief executive was on sick leave at the time,” Botha added.
He said it was apparent from the management’s response that they were out of touch, which seemed to be in contrast to comments made by the chairman in his letter contained in the company’s annual report last year.
In that letter Roger Phillimore referred to challenging labour relations and an illegal strike at the Karee operations. “This incident was the result of an internal union leadership dispute, not through any difference with management.
“We are determined to maintain a positive and constructive relationship with our entire workforce,” Phillimore said. He noted that community relationships were challenging, “…considerable management effort is going into building a more effective rapport with community leaders”.
With regard to the rights issue Botha said he wanted to get clarity on how much of the funds being raised would be committed to Eastern Platinum and how much to Western Platinum. Lonmin said it needed to get at least $700m of net proceeds from the share sale by December 31.