|
Union doubles its estimate of redundancies from a Harmony-Gold Fields merger to 14 000 Solidarity fears jobs doom January 24, 2005 By Nicky Smith Johannesburg - The Solidarity trade union has doubled its estimate of job losses that would result from a merger of Harmony and Gold Fields to 14 000. Spegs Vermeulen, the national organiser for Solidarity, said the union based its estimate on a scenario where Harmony would agree to exclude its loss making and marginal operations from the merged company. He said these would most likely be the nine shafts at Harmony`s Freegold operations, but added: `At this point, it is all speculation.` Once the two companies disclosed the full effects of a merger - including potential job losses - in their filings to the competition authorities, a clearer picture would emerge. Vermeulen said the initial 7 000 job losses would come from the possible closure of Harmony`s Free State operations. The other 7 000 job losses would come from cuts that Harmony has said it would make at Gold Fields in terms of head office savings. Harmony communications adviser Jennifer Cohen said that in competition commission filings the maximum number of job losses indicated by Harmony was 1 500. These would not be jobs on the mines but at management and head office level. But Willie Jacobsz, a spokesperson for Gold Fields, said the commitment by Bernard Swanepoel, Harmony`s chief executive, to cut head office costs by R98 million and senior management costs by R264 million a year would mean that everybody above shift-boss level would be fired. Jacobsz said if Harmony improved its offer ratio to 1.7 Harmony shares, Swanepoel would have to cut Gold Fields costs by 50 percent for Harmony to break even on the deal. `You must remember that 50 percent of our costs are people. They would have to fire about 40 percent of Gold Fields` employees.` Gold Fields employs 46 000 workers and Jacobsz expected between 15 000 and 20 000 jobs to go. On Thursday Patrice Motsepe, the chairman of African Rainbow Minerals and Harmony, said he understood that in the negotiations between Gold Fields and Harmony there was `agreement on everything` but price. Motsepe and fund manager Allan Gray, Harmony`s two biggest shareholders, have said they would not support a higher offer. However, these two supported Harmony`s massive increase in issued share capital, which would enable Harmony to improve its offer if necessary. One of Gold Fields` conditions for any deal is that Harmony excludes its marginal operations. Bloomberg reported on Friday that Harmony was expected to post its fourth consecutive quarterly loss when it reported its second-quarter results to December on February 3. Harmony`s continuous operations (conops) programme at its marginal Free State operations ground to a halt after the failure earlier this month of talks between the company and the National Union of Mineworkers. Rumours that Harmony had given nine of its mine managers six weeks to turn round the Free State operations or face closure could not be confirmed on Friday. Solidarity`s Vermeulen said the mine managers he had spoken to had emphatically denied the rumours. On October 18 Harmony launched an all-share bid for Gold Fields, offering 1.275 Harmony shares for every Gold Fields share. Harmony said on Friday it had extended the closing date of its offer to March 18 while it waited for the outcome of the investigation of the proposed merger by the competition authorities. It told the JSE Securities Exchange that by last Thursday that it had, in terms of its offer, received acceptances for about 11.5 percent of Gold Fields` shares. `Harmony considers this level of acceptances to be consistent with customary market practice, where an offer is still awaiting approval from the competition authorities.` With the irrevocable undertaking from Russia`s Norilsk to tender its 20 percent stake in Gold Fields, this meant that `Harmony now either owns, has received valid acceptances of the subsequent offer or has an irrevocable undertaking to accept the subsequent offer in respect of ... approximately 31.5 percent of the entire issued share capital of Gold Fields`.
| Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information. | |||||||||||||
| Other Profile Group sites: FundsData Online (unit trust data) | Profile Group corporate site | |||||||||||||
| [ Terms of Use | Privacy Policy | PAIA manual | FAQs/Help | Site Map | © Copyright Reserved 2026 ] | |||||||||||||
|
|||||||||||||
