Top global producer Anglo American Platinum said on Monday it would offload some of its South African mines following a debilitating five-month wage strike which cut annual production by 40 percent.
“We have decided that we will exit from the Union and Rustenburg mines,” the firm said, announcing interim results that showed it lost at least 424,000 ounces during the industrial action.
The firm’s operations in Rustenburg, northwest of Johannesburg, were hit hard when about 80,000 members of the Association of Mineworkers and Construction Union (AMCU) downed tools in January for higher pay.
The parties signed a new wage deal at the end of June.
Amplats’ headline earnings fell to $14.8 million (10.9 million euros) in the first six months of the year, compared to $126.2 million in the same period last year.
The platinum producing arm of Anglo American merged parts of its Rustenburg operations last year to help boost profits.
The company said the mines “will be better placed in the hands of a new owner who would be able to provide the focus and capital for the operations to have a successful and long future”.
Amplats will also give up its Pandora mine, which is jointly-owned with a subsidiary of London-listed Lonmin.
The National Union of Mineworkers (NUM) reacted with “serious concern” at the firm’s decision to sell its “oldest South African platinum mines”, saying the move would cut 20,000 jobs.
“Any sale is going to result in job losses and this is punishment for poor workers,” said NUM general secretary Frans Baleni.
The union said it would pressure the company in an attempt to prevent job losses. South Africa accounts for 80 percent of the world’s platinum supply and nearly a third of the world’s palladium.
But in recent years the sector has experienced intermittent strikes over wages, with unions demanding above inflation increases for workers, slashing profits.
Last month, Amplats and two other top producers Impala Platinum and Lonmin reported a combined loss of 24 billion rand ($2.26 billion, 1.67 billion euro) in earnings as a result of the longest mining strike in South Africa’s history.
The strike ended on June 24.