Amplats announcement might not please anyone

Sometimes bad news is ummmm..... good news. And someone elses bad news might be your good news, especially if you are a hyena or vulture, who get a bad rap, but sure clean up a real stink. And the news that the Amplats restructuring as well as the usual (sigh, sadly) labour unrest events, could actually send the platinum price more than a little higher in the coming months. See this: This Is What Could Drive Platinum Higher, Very Soon. Remember how ironically lower production (as a result of power "constraints") back in early 2008 led to enormously high platinum prices which equalled monster profits for the platinum producers. Perhaps..... but in the office we feel more inclined to be in the Rand price of platinum. Did you watch Hot Stoxx on CNBC (channel 410 on DSTV) last night? No? Don't forget that each and every weekday night at 8 and then every weekday morning at 8 (repeat) that the Hot Stoxx show is on. Personally I think it is an awesome show, but I would say that of course. Watch it and send feedback to us, and Paul specifically. You can also watch it online at ABNDigital.com – check it out: HOT STOXX.


But wait, not too fast! At the stroke of midday, Amplats put out a review of their mines, firstly in mid January: Amplats operational review sees shaft closures, jobs on the line. My closing line was, I await for the response from government and the unions. Guess what, a you-know-what-storm broke out. Amplats were accused of all sorts of things, various political heavyweights suggested that Amplats mining licences should be revoked. Really. The announcement was delayed, postponed initially to the Easter weekend, perhaps someone forgot to look at the calendar. And now it has been released. And it certainly looks like a compromise to me.


If you want the statement straight from the horsemeat's mouth, check it out: Anglo American plc draws attention to an announcement issued by Anglo American Platinum Limited. Oh dear. It looks like a bad outcome for labour. Oh, and it looks like government are not going to be happy with closed shafts, and lower production which equals lower tax collection. Oh dear, and shareholders are not going to be happy because it looks a little leaning in the wrong direction. The minority shareholders might argue that they, as the owners of the business might be entitled to stand at the front of the queue. True. This must possibly have been the finest and squeakiest negotiating that Chris Griffiths has ever had to do. There is a word underlined in the statement:

"We have been working diligently to reach the shared objective of creating a competitive platinum business for the benefit of all stakeholders. These revised proposals reflect our commitment to South Africa and our role in addressing the socio economic challenges facing the country, while recognising that we need to take actions to return the company to profitability."


Stakeholders? I guess the suggestion that these are proposals means that this is what is actually going to happen. I expect an announcement soon from labour. And I suspect they wont be happy and be more militant in their approach. I hope that I am wrong. Meanwhile the stock is DOWN just over two percent, having recovered a little. Bad news for everyone.