The appointment of Ben Magara as CEO of Lonmin is the best decision made by the Lonmin board since they got rid of former CEO Brad Mills in September 2008.
Mills, a self-confessed mechanization zealot, whose attempts to mechanize Lonmin’s mining operations were unsuccessful, stepped down by mutual consent and was soon followed by his chairman, John Craven, who retired in January 2009.
Prior to this, Craven had famously declared Mills had the full support of himself and the Lonmin board for his policies.
Mills was replaced by former chief financial officer Ian Farmer, who made major changes. He was making good headway when he resigned last year because of ill-health at precisely the same time the labor mayhem erupted at the group’s Marikana mine.
Forty-six-year-old Magara is a highly-experienced mining engineer and, up until now, an Anglo American Corporation ‘lifer’. He worked for the group for 22 years, starting on the Wankie Colliery, now known as Hwange, in Zimbabwe, before coming to South Africa in 1994.
He has occupied a string of top positions in Anglo’s coal division and is currently head of engineering and capital projects at Anglo American Platinum (Amplats). Magara will assume his position at Lonmin on July 1.
The obvious question is: why is Magara leaving Anglo? You don’t have to look too far for the obvious answer. Sources indicate he was overlooked for the top position at Amplats, where last year Chris Griffith was appointed to replace former CEO Neville Nicolau.
That’s the second time Magara has been overlooked for a top spot at Anglo, after being shifted into Amplats during a group management reshuffle in 2009, from his previous position as CEO of Anglo’s South African coal operations.
Magara ticks all the boxes for the top position at Lonmin starting with his profession, because a criticism frequently voiced by analysts over mining company CEOs with a financial background, is that they don’t have the technical background to stop their mine managers pulling the wool over their eyes.
But he also comes with plenty of experience in the areas that have been increasingly crucial to running a mining group in South Africa—black economic empowerment (BEE), safety and health issues and, arguably most important of all, dealing with politicians.
In his position at Amplats Magara was responsible for bringing the group’s Unki platinum mine in Zimbabwe on stream. It was developed successfully and with little confrontation with the Zimbabwe government over indigenization.
At Anglo Coal, Magara made his name running the New Denmark Colliery, where he introduced a new and highly successful safety program dubbed “Smarty”—an acronym for ‘safety must always relate to yourself’. He was also closely involved with the creation of Anglo Inyosi Coal—a BEE joint venture setting up a major domestic coal company, which holds the contract to supply the new Kusile power station being built by Eskom—South Africa’s national power supplier.
Magara is also no stranger to crisis management, having been appointed head of the working group created to deal with the coal supply crisis early in 2008, when Eskom’s mismanagement of its coal stockpiles triggered a temporary shutdown of the South African power grid.
He pulled no punches at the time declaring in an interview that: “Had Eskom placed orders for extra coal sooner, we could have done something about it sooner.”
I singled out Magara in the 2010 edition of Rainmakers and Pot Stirrers: Your Guide to the 100 Most Influential People in SA’s Mining Industry as a man destined for bigger things.
So I am not surprised to see him moving to the top slot at the world’s third largest platinum producer. He faces some huge challenges but I have no doubt he’s going to crack it
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