Glencore Xstrata has tightened its grip on platinum miner Lonmin with two of its directors joining the board.
The merged mining group holds 24.5% of Lonmin as a legacy of Xstrata's original interest in the business. Now Glencore's Gary Nagle and Paul Smith will join Lonmin as non-executive directors with immediate effect. Analysts at Investec said:
It is surprising that board members from Glencore Xstrata had not appointed directors previously, although no doubt the company has been busy progressing its merger with Xstrata. Xstrata had previously wanted to consolidate their ferrochrome, platinum and vanadium assets into Lonmin, such a plan may re-emerge. Glencore Xstrata is to host an analyst day [on Tuesday] that may provide some clarity on its strategy concerning Lonmin.
SP Angel said:
The appointment of directors from Glencore Xstrata is not surprising given the stake the company has in Lonmin and could result in a more pro active relationship between the two companies.
Lonmin is currently 0.7p higher at 343.4p while Glencore has climbed 3.35p to 321.7p.
