AngloGold picks Harmony to buy South African assets
JOHANNESBURG – AngloGold Ashanti has picked Harmony Gold Mining as the buyer for its last remaining South African operations, according to people familiar with the matter.
The two companies are still finalising the exact terms of the deal for the Mponeng mine and surface facilities, said the people, who asked not to be identified because the information is private.
AngloGold is selling the assets as CEO Kelvin Dushnisky focuses on more profitable mines in Ghana, Australia and the Americas. Harmony – backed by billionaire Patrice Motsepe’s African Rainbow Minerals – is hunting for deals to replenish declining reserves in South Africa. Harmony paid $300-million for AngloGold’s Moab Khotsong mine in 2017.
Marian Van Der Walt, a spokesperson for Harmony, and AngloGold spokeperson Chris Nthite declined to comment.
Mponeng, the world’s deepest mine, produced 265 000 oz of gold in 2018, while output from the surface operations, which extract the precious metal from ore dumps, totaled 171 000 oz. Those South African assets accounted for about 13% of AngloGold’s production that year.
AngloGold said last week that it plans to provide an update on the asset sale on February 21. In November, AngloGold narrowed the list of bidders for its South African assets to Harmony and Sibanye Gold, people familiar with the matter said at the time.
The strategic rationale to find a buyer “trumps a straight valuation call” for the operations, said James Bell, an analyst at RBC Capital Markets in London. AngloGold needs to sell the assets before it can move its primary listing from Johannesburg to London, “something that we think could drive a material re-rating in time.”
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