Sir John Craven,
Chairman,
Lonmin
 
London, England — MININGREVIEW.COM – 03 September 2008 – Lonmin plc – the world’s third- largest platinum producer – has come out strongly again against Swiss-based Exstrata plc’s US$10 billion (R75 billion) hostile takeover bid, insisting that it is too low, and urging investors to reject it.

“The offer is opportunistic, and the price is totally inadequate and doesn’t reflect the value of Lonmin or its unique assets,” chairman John Craven said here in a telephone interview with Bloomberg News. “Investors would be surrendering the company’s potential if they accepted.”

Lonmin says it can revive production after battling power cuts at South African mines, strikes safety stoppages and slumping platinum prices, arguing that the disruptions were temporary. Meanwhile Xstrata – the world’s fourth-largest copper producer – says it is better placed to reorganise operations, after declining output had driven Lonmin shares to their lowest level in more than two years.

Bloomberg reports that Lonmin rose to 3 432 pence at yesterday’s close on the London Stock Exchange, adding to the 48% increase since the bid was unveiled on 6 August – 4 % more than Xstrata’s 3 300-pence, all-cash offer, indicating that investors are betting on a higher bid.

Xstrata – which already holds 11% of Lonmin’s stock – fell 118 pence, or 4%, to 2 804 pence in London trading.

In another telephone interview from London, Xstrata spokeswoman Claire Divver said Xstrata’s offer “fully and fairly” valued Lonmin’s operations and growth potential, while acknowledging the risks, time and investment involved” in the turnaround.

“Lonmin will continue to explore all options to maximise value for our shareholders,” the London-based company said in a statement.

“We are in a trough and we will climb out of it and get back to our traditional production levels fairly quickly,” Sir John said. “The company will return to its prior annual platinum output of 900 000 ounces and beyond, and will give more details of its plans when Xstrata makes a formal offer, he added.