South Africa's largest gold producer Sibanye-Stillwater is to buyout Lonmin, the world's third biggest, but troubled platinum producer, for £285 million ($383 million), the companies announced on Thursday.

Lonmin, whose Marikana mine was the scene of the infamous 2012 mineworkers massacre where police gunned down 34 striking workers, has for the past five years been battling low platinum prices and high operating costs, exacerbated by labour unrest in South Africa.

"We believe that this offer is in the best interests of Lonmin," said the CEO of Lonmin Ben Magara.

Despite the company boasting of great mining assets, projects and process technology and a resilient workforce, it "continues to be hamstrung by its capital structure and liquidity concerns," said Magara.

Sibanye-Stillwater CEO Neal Froneman foresees the  proposed buyout bringing about longer term benefits for both companies.

He also stated that the acquisition would "create a more robust business" that is better able to withstand volatile platinum prices and exchange rates.