It is unacceptable that money of public servants will now be used to rescue the unstable Lonmin, Adv. Anton Alberts, the FF Plus’ parliamentary spokesperson on the Economy said.
According to media reports today, the Public Investment Corporation which manages the public sector’s pension funds will acquire a further 25% in Lonmin with this rights issue of the struggling platinum producer. The investment amounts to R1,9 billion.
Lonmin’s share price dropped by 80% this year from R35 to less than R3 earlier this month. With regards to market value, it stood at R29 billion a year ago. At present it is valued at R3,5 billion.
Adv. Alberts says the FF Plus will be taking up the issue with the Minister of Finance and the pension funds adjudicator to prevent the public servants’ from losing their money. He said it is extremely risky to invest funds in a company which is on the brink of bankruptcy.
What is happening at present is not a calculated business decision at all. Nearly R2 billion of public servant’s pension funds are being used in an irresponsible and dangerous manner to gamble with for mere political reasons.
“It is well-known how Transnet’s pension funds were stripped. The class action of nearly R80 billion would be heard in court shortly.
“This investment in Lonmin is heading for a similar fiasco and it must be stopped before the money is wasted just to lobby support for the ANC,” Adv. Alberts said.
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