Lonmin CEO says will not shy away from merger or takeover

By Olivia Kumwenda-Mtambo

CAPE TOWN, Feb 9 (Reuters) - Lonmin (Berlin: 30318982.BE - news) will not "shy away" from a merger or takeover but for now the company was focused on its plan to survive tough market conditions, its chief executive said on Tuesday.

"We are continuously looking at options to maximise value for our shareholders and all other stakeholders. Should it be of benefit to our shareholders and stakeholders it's not something we would shy away from," CEO Ben Magara told Reuters in an interview at a mining conference in Cape Town.

Magara said the company was for now focused turning cash positive in a low price environment - which involves closing high-cost shaft and cutting jobs.

"That's what I am worrying about. The investors have given us money and we must deliver. Investors are asking if we are going to deliver on this," Magara said.

Hurt by a prolonged 2014 strike, rising costs and a plunging platinum price, Lonmin raised $400 million through a cash call in December.

"I have no doubt that there will be pressure on us when we finally start making money. Will we go and put it in a project first or will we pay investors?" Magara said.

"I think it's important that investors will get their money back first. They deserve it."

Lonmin has said it will continue to review its services and reduce costs, mainly through cutting jobs, as the slide in the price of its main commodity bites further.

The price of platinum has fallen about 30 percent year-on-year, forcing miners to sell assets and cut production and jobs. Around two-thirds of the industry, whose mines were damaged by the five-month strike in 2014, are making losses. (Editing by James Macharia)