VILLAGE Main Reef (VMR) said it hoped to limit retrenchments of 7,000 employees at its Tau Lekoa and Kopanang mines which racked loss just over R700m in losses despite record rand gold prices over the last six months.
Digital publication, Business Maverick, reported on February 4 that the West Rand mines were on the verge of collapse – a development that prevented the listing of their holding company on the Hong Kong Stock Exchange in December.
In an internal note, VMR said that: “Due to the listing not taking place we won’t have funds. HSC (Heaven Sent Capital) have invested R2.2bn since they took over. During this time we have had no retrenchments. In 2019, we incurred a R664m loss”.
Jeff Dong, the newly appointed CEO of VMR, said in a statement today that the mines were in difficulty owing to poor grades achieved at the mines whilst Eskom outages and seismic events had also contributed to the operational crisis.
“Despite the postponed listing and challenging operating environment, we made the decision to continue to invest and support the VMR Group,” said Dong in a statement. VMR now had “… a much more active operational involvement in the business,” he said.
There had been new senior appointments with an improved performance, he said. As a result of this intervention restructuring of the company’s operations and possible job reductions “… may be avoided,” he said.
“We plan to build from the successful turnaround of the VMR Group and expand our business, and to revisit a future listing,” said Dong.
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