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The Guardian - UK
The Guardian - UK
Business
Simon Neville

Lonmin unveil new boss but will his first job be announcing a rights issue?

Lonmin shares continue to fluctuate as the miner's uncertainty continues.

However, one part of its future is slightly clearer, for the time being.

Chief executive, Ian Farmer was hospitalised last week after doctors discovered a "serious illness" (exactly what he has is still not public) and has now stepped down temporarily.

This morning, Simon Scott, chief financial officer, has been made acting CEO.

The company said: "Ian Farmer, the Chief Executive Officer of Lonmin Plc (Lonmin), has commenced a course of treatment and it will be some months before he is able to return to work full-time."

So who is Simon Scott?

The 54-year-old South African is a member of the South African Institute of Chartered Accountants and previously held the position of financial director of Aveng Group, a major construction and infrastructure business in the mining sector.

A student of accounting at the University of the Witwatersrand in Johannesburg, his first job, according to LinkedIn, was as a trainee accountant with Arthur Young (one half of Ernst and Young before its 1989 merger).

He then moved on to JP Morgan where he rose to the rank of chief financial officer in southern Africa, leaving in 2001 to dip his toes into platinum at Anglo Platinum as business manager and then head of financial services.

A quick stint at Aveng, an infrastructure firm, led to Lonmin in September 2010.

Last year he was paid £557,268.

His first job as acting CEO may have to be going to shareholders for a rights issue.

Alison Turner at Panmure Gordon said:

With little sign of an imminent return to work by striking rock drill operators, we have updated our Lonmin forecasts to build in a six week strike. That would make a September covenant breach almost unavoidable, and a rights issue increasingly likely. If Lonmin did go down that route we believe it could look to raise around US$700m.

Lonmin's biggest shareholder is Xstrata - the rival miner has a 29% stake it bought in 2008 when it attempted a takeover.

Shares in Lonmin are down 13.5p, 2.1%, at 626.8p.

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