June 28, 2017 / 11:59 AM / a month ago

AngloGold considers 8,500 job cuts in S.Africa revamp

2 Min Read

JOHANNESBURG (Reuters) - AngloGold Ashanti is considering laying off 8,500 workers, some 30 percent of its workforce, Africa's biggest gold miner said on Wednesday, as it looks to restructure its South African mines.

"It is critical that we act to protect the long-term sustainability of this business and the majority of our workforce," Chief Executive Officer Srinivasan Venkatakrishnan, said in a statement.

It said its South African gold mining operations had experienced "heavy, and ultimately unsustainable, losses".

The company, which employs 28,000 people, said the potential lay-offs were part of its efforts to improve production and the cost base of its South African business.

In May, AngloGold reported a 16 percent drop in first-quarter profit following a decline in South African production and said it was reviewing its operations to restore margins and ensure their recovery.

AngloGold shares fell 4.29 percent to 132.23 rand.

The biggest union in the gold sector by membership, the National Union of Mineworkers (NUM) said it would "fight tooth and nail to make sure that its members are not retrenched cheaply."

"The NUM is extremely angry and shocked that Anglogold Asanti is likely to retrench such a huge number of workers at the time when there is a high rate of unemployment in the country," spokesperson Livhuwani Mammburu said in a statement.

Trade union Solidarity said it would work with the company to try to retain as many jobs as possible.

However, the union expressed concern about the potential for further job cuts across the sector due to new rules announced by the government to raise the minimum threshold for black ownership of mining companies to 30 percent from 26 percent.

With additional reporting by Nqobile Dludla; editing by Louise Heavens and David Evans

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