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AngloGold Ashanti Threatens to Close Mines If Strikes Continue

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Strikes continue at all of AngloGold Ashanti's  (NYSE: AU  )  South African mines a week and a half after they began, but the company reported today that its stance remains firm. "We do not intend to reward broken commitments, violence and threats of intimidation," reads one of seven bullet points in press release detailing the company's approach to the strikes at its South African mines. The strikes, which began on Sept. 20 with one location, quickly spread to the remaining five South African mines by Sept. 25. All six locations are shut down in the wake of the dispute.

Workers across South Africa began striking on Aug. 10, when workers at platinum producer Lonmin went on strike and violence broke out, leaving 46 dead. That strike was resolved in September with a 11-22% pay increase.

AngloGold Ashanti also announced that if these "unprotected" strikes continue, the company may have to indefinitely shut down its operations in the country and dismiss its entire workforce. The company employs 35,000 people in the South Africa, 24,000 of whom are striking. AngloGold's stance is that it will not negotiate outside the boundaries of the agreed-upon collective bargaining process. The miners are currently in the middle of a two-year wage agreement. Wages increased anywhere from 8% to 10% in July, the company said, and a similar increase was awarded last year.


John Divine has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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10/21/2016 4:00 PM
AU $13.88 Down -0.16 -1.14%
AngloGold Ashanti CAPS Rating: ***