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24 May 2005
Harmony's loss is the workers' victory - Abacus While further consolidation and retrenchments in the mining industry are expected as the once-powerful business sector moves into its twilight years, the fact that Harmony's hostile paper-only takeover bid for AngloGold failed is "extremely good news for job retention and the economy as a whole", said Org Geldenhuys, a director of Pretoria-based executive search and IT recruitment company. "If Harmony's bid had been successfully you can be sure that Harmony's CEO Bernard Swanepoel would have slashed thousands of jobs from the head office structures, adding to the job losses we are seeing consistently in this industry. The gold sector has steadily been shedding jobs - more than 11 000 were lost by the middle of last year - and another 12 000 are on the line within Harmony as we speak. If Harmony's bid had been successful that 12 000 figure mooted could have swelled to more than 15 000. It is true that, during this same period, more than 30 000 jobs were created in the platinum sector - but that doesn't mean we have to ignore job losses in the mining industry." Geldenhuys said that while the failed bid for AngloGold is good news for both Harmony and AngloGold workers, this good news might only be short-term. "In essence Harmony needed to take over AngloGold. Many of its mines are marginal and it needed the fat it could have gained from taking over AngloGold, which is certainly in a far more rosier financial position. Time will tell whether or not Harmony has the ability and the resources to dig itself out of its hole and its current high level of gearing. Some mining analysts have even suggested that Harmony will not survive another year. But its recent sale of some of its shares in AngloGold for more than R1 billion might just give it a new lease on life. At the end of the day the saving of jobs due to the failed takeover might just end up being nothing more than a reprieve." |