Sir John Craven's attempts to defend Lonmin, the platinum producer, from a £33-a-share hostile bid from Xstrata have been undermined by the revelation that he sold two thirds of his personal stake in the company for only £1 a share more.

Lonmin's chairman has described Xstrata's offer as ridiculous, despite selling 63,808 shares at £34 in February. This raised nearly £2.2 million and left Sir John with 30,000 shares. He has not bought any since. Lonmin has rejected the Xstrata approach, claiming that the £5 billion offer undervalues its platinum mines in South Africa.

Sir John has begun a roadshow to convince investors that they should reject the Xstrata approach, but his argument may be weakened by his sale of shares at only 3 per cent more than the offer price.

He is not the only member of Lonmin's board to have sold shares close to the offer price. Roger Phillimore, the deputy chairman, sold 15,212 shares at £33.97 in February, netting £516,000. This left him with 3,614 and he has not bought any more since.

A Lonmin spokesman said that the shares had been sold to beat a rise in capital gains tax. He said: “It is nothing to do with the price , they sold only to avoid the tax increase.”

That argument has not convinced some institutions that are being urged by Sir John not to take £33 a share. One City banker familiar with Lonmin's defence said: “Sir John must have thought he was getting a good price in February or he would not have sold, which makes his claim that £33 is too low look absurd.”

Xstrata declined to comment.

When Sir John and Mr Phillimore sold their stakes in Lonmin, the company's share price was trading in a £33-to-£34 range. It slumped to a low of £21.56 in July after production problems and a fall in the platinum price.

Xstrata's offer, made on August 6, was a 42 per cent premium to the previous day's close. The Anglo-Swiss miner has acquired nearly 13 per cent of Lonmin's stock at £33 a share and it is raising financing to make a full bid.

Last week Xstrata refused to raise an A$503 million (£235 million) offer for Indophil, an Australian copper miner, after a rival bid by Stanhill Resources. Robert Stafler, of Excellion Capital, said: “Indophil is a reminder to the market that when Xstrata is serious about a price it is not afraid to walk away if more is demanded.”

Meanwhile, Xstrata is understood to be haggling with bankers over the terms of a $15 billion (£8.1 billion) loan that will pay for both the Lonmin deal and the refinancing of existing debt. Bankers familiar with the negotiations said that the loans were being offered on less favourable terms than the company had been used to in the past. Sources close to the company believe that it could take much longer before the money is in place and a formal offer is tabled.

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