The Conversation (0)
The Telegraph reported Lonmin’s (LSE:LMI) rights issue is no surprise and a positive move for the miner.
The Telegraph reported Lonmin’s (LSE:LMI) rights issue is no surprise and a positive move for the miner.
As quoted in the market news:
Lonmin has been forced into raising $800m (£497m) as the group was at risk of breaking its banking covenants. This is now unlikely, but significant challenges remain after 20,000 ounces of production was lost in recent wildcat strikes in South Africa.
The strikes have curbed platinum output so much that the market could move into deficit next year, which should support prices. However, platinum prices are also more dependent on the European economy than other metals.