COMPETITION TRIBUNAL - Competition Tribunal statement: Sibanye Stillwater / Lonmin merger

Competition Tribunal statement: Sibanye Stillwater / Lonmin merger

COMPETITION TRIBUNAL OF SOUTH AFRICA


                                                               Case No: LM315Mar18


 In the matter between:

 SIBANYE GOLD LIMITED (T/A) SIBANYE -                                  Acquiring Firm
 STILLWATER


 and


 LONMIN PLC                                                               Target Firm




 Panel                        : Enver Daniels (Presiding Member)
                              : Mondo Mazwai (Tribunal Member)
                              : Yasmin Carrim (Tribunal Member)

 Heard on                     : 12-14 November 2018

 Order issued on              : 21 November 2018

 Statement issued on          : 21 November 2018


                                TRIBUNAL STATEMENT



[1]    The Tribunal has decided to issue this statement in order to provide context to
       the Conditions on which the Tribunal has approved the Lonmin & Sibanye
       merger. Full reasons for our decision will follow in due course. The statement
       will address only the conditions in respect of retrenchments and the Social
       Labour Plans (SLPs).




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Retrenchments

[2]   This merger involves massive public interest issues involving extensive job
      losses and impact in the platinum mining region of the North West.


[3]   The issue of which retrenchments related to Lonmin’s operational requirements
      and which were merger-specific became an intensely disputed issue.


[4]   Sibanye, as part of its operational plan envisioned that it will retrench 13 334
      jobs post-merger. Of these, only 885 are merger specific since they arise from a
      duplication in overheads.


[5]   Lonmin in its plan of October 2017 (“Lonmin October plan”) planned to retrench
      10 156 employees. The Commission, after investigating the merger, considers
      the difference between the Lonmin October plan (also called the Stand-Alone
      plan) and Sibanye’s plan to be merger specific under the purview of the Act. In
      its recommendation, it argues that any figure of retrenchments over and above
      10 156 is to be considered merger specific. AMCU, the intervening party argued
      that all the planned retrenchments should be viewed as merger related.


[6]   The issue of identifying the exact number of merger related retrenchments is
      thus not clear-cut. Even the figure of 885 is not easily identified as being merger
      related because the number is calculated by Sibanye as being the difference
      between savings of 62 jobs at the operational level and overhead merger related
      job losses of 947.


[7]   The merging parties have been transparent and co-operative with the
      Commission and the Tribunal in sharing their assessment of the possible
      number (between 10 156 and 13 444) of job losses.


[8]   In addition, Sibanye has been co-operative in providing several undertakings. It
      has undertaken to do a feasibility study in an Agri-Industrial Program, an
      economic assessment of further investments in identified shafts and establishing
      a consultative forum in respect of the implementation of SLPS.

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[9]   Its undertaking in respect of retrenchments was a moratorium for six months on
      the retrenchment of 1831 jobs.


[10] After giving due consideration to this undertaking, the Tribunal is unable to
      determine the exact number of merger specific retrenchments which may on any
      construction be between 885 and 13 344. In order to protect what would be the
      merger specific job losses, whether this number be 885, 1831, 10 156 or 13 344,
      our view is that Sibanye should be given an opportunity to do an in-depth
      assessment of the operational requirements of the target firm and to consult with
      all relevant stakeholders which include trade unions. Accordingly, it is our view
      that the public interest will be best served if a moratorium were placed on all
      retrenchments for a period of 6 months from the implementation date.


SLP’S

[11] The conditions in respect of the SLPS are self-evident, but fuller reasons will be
      provided in due course.




                                                               21 November 2018
 Mr Enver Daniels                                                     Date

 Ms Yasmin Carrim and Ms Mondo Mazwai concurring.




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