| Fri 23 May 2008, 8:18 | | ANG - AngloGold Ashanti - Final Terms Of The Right |
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ANG
ANANO
ANG - AngloGold Ashanti - Final Terms Of The Rights Offer And Withdrawal Of
Cautionary Announcement
AngloGold Ashanti Limited
Incorporated in the Republic of South Africa
Registration Number: 1944/017354/06)
ISIN Number: ZAE000043485
JSE Share Code: ANG
("AngloGold Ashanti/Company")
This is not an offer for the sale of securities. Not for release or
distribution in or into the United States
FINAL TERMS OF THE RIGHTS OFFER AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
1 Introduction
Shareholders were advised in an AngloGold Ashanti announcement on 21 May
2008 that AngloGold Ashanti had finalised the terms of the rights offer and
was seeking to raise, subject to certain conditions, approximately
ZAR13.48 billion (US$1.77 billion based on an exchange rate of ZAR7.63/US$1 on
20 May 2008) via a renounceable rights offer of 69,470,442 new ordinary shares
of 25 cents each ("rights offer shares") to holders of AngloGold Ashanti
ordinary shares of 25 cents each ("AngloGold Ashanti shares") and E ordinary
shares of 25 cents each ("AngloGold Ashanti E shares") at a subscription price
of ZAR194.00 per rights offer share ("subscription price") and in the ratio of
24.6403 rights offer shares for every 100 AngloGold Ashanti shares held
("rights offer").
The subscription price is at a discount of 36.1% to the closing price of
AngloGold Ashanti ordinary shares on 20 May 2008 (being the last practicable
date prior to the finalisation of the subscription price) of ZAR303.79 and at
a discount of 31.2% to the theoretical ex-rights price of an ordinary share of
ZAR281.83 on the same day.
At a general meeting of AngloGold Ashanti shareholders held on 22 May 2008,
AngloGold Ashanti shareholders approved the general authority to AngloGold
Ashanti directors to allot and issue to a maximum of 71 million additional
shares for the purpose of implementing the rights offer.
All conditions precedent to the commencement of the rights offer have been
fulfilled.
Mark Cutifani, CEO of AngloGold Ashanti commented "We are delighted with
the support for the rights issue demonstrated by the emphatic nature of the
shareholder approval at yesterday`s general meeting and also the positive
reaction in our share price since announcement. As a result we have been able
to finalise the pricing of the rights issue at a higher level than initially
contemplated which will increase proceeds to the company by around
ZAR1.5 billion, giving us more flexibility in implementing our strategy, in
particular the restructuring of the hedge book."
2. Purpose of the rights offer and use of proceeds
The principal purpose of the rights offer is to provide AngloGold Ashanti
with additional financial resources to improve its financial flexibility. In
particular, the net proceeds from the rights offer will allow AngloGold
Ashanti both to significantly restructure and reduce its existing gold hedging
position, which has adversely affected its financial performance in recent
years, while also being able to continue to fund its principal development
projects and exploration growth initiatives. Pending this use of proceeds, as
described in detail below, the net proceeds of the rights offer may, in the
interim, be used by AngloGold Ashanti to reduce its short-term borrowings and
the borrowings outstanding on AngloGold Ashanti`s revolving credit facility or
retained as cash and invested in accordance with AngloGold Ashanti`s cash
management policies.
Reducing AngloGold Ashanti`s gold hedging position
AngloGold Ashanti has traditionally used gold hedging instruments to
protect the selling price of some sales against declines in the market price
of gold. The use of these instruments has prevented AngloGold Ashanti from
fully participating in the significant increase in the market price for gold
in recent years. Since 2001, AngloGold Ashanti has been reducing its gold
hedge commitments through hedge buy-backs, physical settlement of contracts
and other restructurings in order to allow for greater participation in the
rising gold price environment. As at 31 December 2007, the total net delta
tonnage of AngloGold Ashanti`s hedge positions was 10.39 million ounces and
the total committed hedge position was 11.28 million ounces, an increase of
0.16 million ounces and a reduction of 0.34 million ounces against the
31 December 2006, hedge delta and hedge committed position, respectively. As
at 31 December 2007, the marked-to-market value of all hedge transactions
making up the hedge positions was negative US$4.27 billion.
As at 31 March 2008, hedging positions of approximately 3.28 million ounces
of hedge delta and 3.66 million ounces of commitments against AngloGold
Ashanti`s gold production will mature in 2008 and 2009. Since the beginning
of 2008, prevailing spot gold prices have been significantly higher than those
prevailing during 2007. If these high prices continue to prevail, AngloGold
Ashanti estimates that, due to its gold hedging arrangements, the prices it
will receive for its gold production during 2008 and 2009 will be
significantly lower than the prevailing spot prices during those years.
AngloGold Ashanti has taken, and continues to take, steps to increase its
participation in the higher prevailing spot prices for gold or that will allow
it to reduce its hedge position as a percentage of its current or future gold
production, including:
- Continuing to deliver into maturing gold hedges or implementing hedge
buy-backs thereby reducing AngloGold Ashanti`s gold hedge position over time.
During the three months ended 31 March 2008, AngloGold Ashanti reduced the net
delta tonnage of its gold hedge by 1.13 million ounces to 9.26 million ounces
by delivering into maturing gold hedges and also effecting opportunistic hedge
buy-backs (limited to non-hedge derivatives).
- Acquiring minority interests at its existing mines and pursuing other
merger and acquisition opportunities with a view to increasing AngloGold
Ashanti`s level of gold production and its ore reserves, thereby reducing its
total hedged position as a percentage of its total gold production and ore
reserves. For example, during the fourth quarter of 2007 AngloGold Ashanti
acquired the remaining 15% minority interest in the Iduapriem & Teberebie
(Iduapriem) mine in Ghana. In addition, in January 2008 AngloGold Ashanti
signed a merger agreement with Golden Cycle Gold Corporation which, if the
acquisition is completed, will allow AngloGold Ashanti to continue to
consolidate 100% ownership of the CC&V mine in Colorado.
- Increasing brownfields exploration and development programmes, both in
and around its existing mine sites, with a view to increasing AngloGold
Ashanti`s gold production and ore reserves, thereby reducing its total hedged
position as a percentage of its total ore reserves. Over the past two years,
AngloGold Ashanti`s total ore reserves have increased from 63.3 million ounces
to 73.1 million ounces (net of depletion of some 11.1 million ounces). As at
31 December 2007, the net delta tonnage of AngloGold Ashanti`s gold hedge
represented approximately 14% of its total ore reserves, or approximately two
years` worth of current annual gold production.
- Continuing to increase its greenfield exploration activities in new
geographical areas. In 2008, the majority of AngloGold Ashanti`s greenfields
exploration expenditure of approximately US$105 million is expected to be
incurred in:
- Colombia, where AngloGold Ashanti has achieved significant exploration
success in the recent past both at its wholly owned properties, in particular
La Colosa where a pre-feasibility study will commence during 2008, as well as
at its various joint ventures;
- Australia, where AngloGold Ashanti is completing a pre-feasibility
study at the Tropicana joint venture; and
- the Democratic Republic of Congo in respect of its Mongbwalu
concession.
Given exploration successes at the above greenfields exploration
projects to date, AngloGold Ashanti expects that in the foreseeable future
these exploration projects are likely to add to its ore reserves and medium to
longer term gold production.
- Identified, as part of a recently completed asset review, those assets
which are no longer considered to be consistent with AngloGold Ashanti`s
desired asset profile. AngloGold Ashanti intends to sell or restructure these
assets over approximately the next 15 months. AngloGold Ashanti expects that
the reduced funding requirements of these assets, together with the proceeds
from any asset sales, will further enhance its financial position and
flexibility and may allow further reductions of its gold hedge position.
Notwithstanding the steps AngloGold Ashanti has taken to date, AngloGold
Ashanti`s gold hedging position has continued to have a significant adverse
affect upon its financial performance. AngloGold Ashanti believes that this
has also negatively affected the market price of its ordinary shares, further
constraining its financial flexibility. In order to address this issue, the
directors have resolved to reduce AngloGold Ashanti`s gold hedging position
significantly. In order to address this, AngloGold Ashanti intends to procure
early settlement of certain contracts otherwise due to mature in 2009 and 2010
during the course of 2008 in addition to settling contracts already due to
mature in 2008. Given the low committed prices of these contracts, AngloGold
Ashanti expects that if these measures were implemented it would result in a
realisation of previously recognised losses measured by the difference between
the committed price of the contracts and the prevailing gold price at the time
that these contracts are settled. If the restructuring is implemented as
anticipated, the received price for the last nine months of 2008 should be
approximately US$475 per ounce assuming a gold price of US$900 per ounce and
gold production for the last nine months of 2008 of 3.8 million ounces.
AngloGold Ashanti also continues to give consideration to the early settlement
of contracts not currently recorded on its balance sheet (Normal Purchase
Normal Sale Exemption ("NPSE")) by means of physical delivery. Such early
physical settlement, if it were to occur, would result in a significant
adverse impact on the revenues recorded in AngloGold Ashanti`s income
statement, as sales that would have otherwise been executed at the spot gold
price will be replaced with sales based on the contracted prices of such NPSE
contracts that are settled, during the year. Furthermore should AngloGold
Ashanti conclude that such early physical settlement of NPSE contracts
represents a tainting event, it would be required to recognise on balance
sheet the fair value of a portion of, or potentially all of, the existing NPSE
contracts, which would result in a significant adverse impact on its financial
statements. No such conclusion has yet been made by AngloGold Ashanti and it
is still considering the potential impact of any such transaction.
In addition to the settlement of certain contracts during 2008 AngloGold
Ashanti intends to restructure some of the remainder of its hedge book in
order to achieve greater participation in the spot price for gold beyond 2009.
The exact nature and extent of the restructuring will depend upon prevailing
and anticipated market conditions at the time, particularly the prevailing
gold price and exchange rates as well as other relevant economic factors.
If the restructuring is executed as currently anticipated the overall
impact would be to reduce the hedge book to approximately 6.25 million ounces,
which would represent 8.6% of AngloGold Ashanti`s ore reserves as at
31 December 2007. As a result of this reduction the discount to the spot gold
price realised during 2009 is estimated to be approximately 6% and at a
similar level thereafter assuming a gold price of US$900 per ounce.
Funding AngloGold Ashanti`s development projects and exploration
initiatives
In addition to restructuring and reducing its gold hedge position, a
portion of the net proceeds from the rights offer may be applied to the
funding of AngloGold Ashanti`s existing development projects and exploration
initiatives consistent with its strategic objective of pursuing growth
initiatives to enhance its shareholder value.
In 2008, exploration expenditure is budgeted at US$220 million, of which
US$105 million is budgeted to be spent on greenfields exploration and US$115
million is budgeted to be spent on brownfields exploration.
Current key brownfields development initiatives underway in 2008 include:
- Boddington: The Boddington project, which involves mining the basement
reserves beneath the oxide pits, was approved by the directors in March 2006.
The project has a current attributable capital budget of US$735 million
(attributable capital expenditure of US$392 million is budgeted for 2008). By
the end of 2007, overall project progress was approximately 65 percent
complete, with engineering and procurement activities nearing completion and
construction of the treatment plant approximately 32 percent complete. Based
on the current mine plan, mine life is estimated to be more than 20 years,
with attributable life-of-mine gold production expected to be greater than 5.7
million ounces of gold. Production is anticipated to commence at Boddington in
late 2008 or early 2009.
- Mponeng Ventersdorp Contact Reef below 120 level: AngloGold Ashanti
estimates that this project, which entails accessing and exploiting the
Ventersdorp Contact Reef ore reserves at Mponeng below 120 level, will add
2.5 million ounces to production over the life of the project. The cost of
this project is estimated to be US$252 million, of which capital expenditure
of US$35 million is budgeted for 2008. This project was approved by the
directors in February 2007, following which construction began. On-reef
development and thus the start of production is scheduled for 2013 with full
production expected to commence in 2015.
- TauTona Carbon Leader Reef below 120 level: This project, which was
approved in July 2003, entails accessing and exploiting the Carbon Leader Reef
ore reserves at TauTona located below 120 level. Production was planned to
begin in 2009 and AngloGold Ashanti estimated that this project would produce
up to 2.5 million ounces of gold from 2009 to 2019. Total budgeted capital
expenditure for this project was US$172 million, of which US$73 million had
been spent by the end 2007. However, this project is currently under review as
it is possible that part of the ore reserves forming this project could be
accessed from the neighbouring Mponeng mine. Capital expenditure of US$17
million was budgeted for this project for 2008.
- Obuasi Tailings Sulphide Plant: This project, which was approved in
April 2008, entails the construction of a flotation circuit to enable the
treatment of lower grade underground sulphide ore (than is being treated at
the existing Sulphide Treatment Plant that currently treats all ore produced
from underground operations) as well as low grade surface sulphide stockpiles
and tailings. The project is anticipated to produce 702,000 ounces of gold
over its life and increase annual gold production at Obuasi by between 50,000
and 85,000 ounces per annum. Production via this plant is anticipated to
commence in the first half of 2009. Capital expenditure of US$44 million is
budgeted for this project for 2008.
- Iduapriem Plant Expansion: This project, approved in November 2006,
involves the addition and modification of metallurgical treatment and
infrastructure at Iduapriem. These initiatives are being implemented to
increase plant capacity, improve gold recovery and also reduce operating
expenditure. It is estimated that these initiatives will add some 117,000
ounces of production over the life of mine at Iduapriem and increase annual
gold production by some 50,000 ounces (albeit over a shorter life of mine
assuming no further growth in ore reserves at Iduapriem). Capital expenditure
of US$42 million is budgeted for this project for 2008. The project is
expected to be commissioned in the fourth quarter of 2008.
AngloGold Ashanti estimates that the total cost to continue to fund its
existing development projects, including those key projects outlined above,
will be approximately US$1,262 million in 2008.
3 Salient terms of the rights offer
The rights offer is being made on the following basis:
Holders of AngloGold Ashanti shares and AngloGold Ashanti E shares
recorded in the register at Friday, 6 June 2008 ("the record date") and/or
their renouncees, are offered on the terms and conditions set out in the
circular referred to in 6 below ("the circular"), 69,470,442 rights offer
shares at a subscription price of ZAR194.00 per rights offer share and in the
ratio of 24.6403 rights offer shares for every 100 AngloGold Ashanti shares
held on the record date. Fractions of rights offer entitlements will not be
allotted, each qualifying shareholder`s rights offer entitlement being rounded
to the nearest whole number.
The subscription price is at a discount of 36.1% to the closing price of
AngloGold Ashanti ordinary shares on 20 May 2008 (being the last practicable
date prior to the finalisation of the subscription price) of ZAR303.79 and at
a discount of 31.2% to the theoretical ex-rights price of an ordinary share of
ZAR281.83 on the same day.
Upon their issue, the rights offer shares will be listed and rank pari
passu in all respects with the existing issued ordinary shares, including the
right to receive in full all dividends and other distributions thereafter
declared, paid or made on the AngloGold Ashanti ordinary shares.
All conditions precedent to the commencement of the rights offer have
been fulfilled.
The latest time and date of acceptance and payment in full for the
rights offer shares will be 12:00 pm (South African time) on Friday 4 July
2008.
Letters of allocation will be issued in dematerialised form and an
electronic record for certificated ordinary shareholders will be maintained by
the transfer secretary, Computershare Investor Services (Proprietary) Limited.
This will enable both dematerialised and certificated holders of AngloGold
Ashanti shares to sell or renounce some or all of their rights to rights offer
shares in accordance with the procedures set out in greater detail in the
circular.
All rights offer shares not subscribed for in terms of the rights offer
will be available for allocation to holders of AngloGold Ashanti shares who
wish to apply for a greater number of rights offer shares than those offered
to them in terms of the rights offer. Accordingly, holders of AngloGold
Ashanti rights offer entitlements may also apply for additional rights offer
shares in excess of the rights offer shares allocated to them in terms of the
rights offer on the same terms and conditions as those applicable to their
rights offer entitlement. The right to apply for additional rights offer
shares is transferable on renunciation.
An announcement will be released on SENS on or about Monday, 7 July 2008, and
published in the press on Tuesday, 8 July 2008, stating the results of the
rights offer and the basis of allocation of any additional rights offer shares
for which application is made.
4 Underwriting
The rights offer has been fully underwritten, subject to certain
conditions, by Goldman Sachs International, UBS Limited, Morgan Stanley & Co.
International plc and J.P. Morgan Securities Ltd.
5 Financial effects
The unaudited pro forma financial information of AngloGold Ashanti has
been prepared in order to show the effects of the rights offer, assuming that
the rights offer took place to its full extent on 1 January 2007 for purposes
of the income statement for the year ended and as at 31 December 2007 for
purposes of the balance sheet. The information is the responsibility of the
directors of AngloGold Ashanti and has been prepared for illustrative purposes
only and may not, because of its nature, give a true picture of the financial
position of AngloGold Ashanti. The pro forma financial information is
consistent in both format and accounting policies adopted by AngloGold Ashanti
in its annual financial statements for the year ended 31 December 2007. It
does not purport to be indicative of what the results or financial results
would have been if the rights offer had actually occurred at an earlier date.
The unaudited pro forma financial information does not reflect the application
of the net proceeds of the rights offer for the purposes described in
paragraph 2 above, but rather includes their application to temporarily reduce
borrowings and increase available cash on hand pending their use for such
purposes. The net share issue proceeds are assumed to be US$1,714 million,
being share issue proceeds of US$1,766 million less the US$52 million of
underwriting cost and issue expenses.
Unaudited pro forma per share information for the year ended 31 December
2007
For the year ended Before After the Movement
31 December 2007 the issue issue (%)
Net asset value per share 1 US cents 867 1,184 37
Net tangible asset value per
share 1 US cents 711 1,058 49
Cash gross profit per
share 2 US cents 543 435 (20)
Basic loss per share3 US cents 237 186 (22)
Diluted loss per share 4 US cents 237 186 (22)
Headline loss per share 5 US cents 230 180 (22)
Headline loss adjusted for
the effect of unrealised
non-hedge derivatives, fair
value adjustment on con-
vertible bonds and interest
rate swap per share 6 US cents 99 84 (15)
Weighted average number of
shares in issue 7 281,455,107 350,925,549 25
Weighted average diluted number
of shares in issue 8 281,455,107 350,925,549 25
Number of shares in issue 9 281,597,701 351,068,143 25
Notes:
1 Net asset value per share is computed by dividing total equity by the
number of shares in issue. Net tangible asset value per share is
computed by dividing total equity (excluding intangible assets) by
the number of shares in issue.
2 The cash gross profit per share computation has been based on the
weighted average number of shares in issue.
3 Basic loss per share is computed by dividing net loss by the weighted
average number of shares in issue.
4 The diluted loss per share is computed by dividing net loss by the
weighted average diluted number of shares in issue. The impact on
diluted loss per share is anti-dilutive and therefore the diluted
loss per share and basic loss per share is the same.
5 Headline loss removes items of a capital nature from the calculation of
loss per share. Headline loss per share is computed by dividing
headline loss by the weighted average number of shares in issue.
6 Headline loss adjusted for the effect of unrealised non-hedge
derivatives, fair value adjustment on convertible bonds and interest
rate swaps divided by the weighted average number of shares in
issue.
7 The weighted average number of AngloGold Ashanti shares in issue was
281,455,107 for the year ended 31 December 2007 and as a result of
the issuance of 69,470,442 AngloGold Ashanti shares at an issue
price of ZAR194.00, the weighted average number of AngloGold Ashanti
shares in issue for that period would have been 350,925,549.
8 The weighted average diluted number of AngloGold Ashanti shares in
issue for the year ended 31 December 2007 does not assume the effect
of 575,316 shares issuable upon the exercise of the share incentive
options as well as 15,384,615 shares issuable upon the conversion of
the convertible bonds, as their effects are anti-dilutive.
9 The number of AngloGold Ashanti shares in issue as at 31 December 2007
was 281,597,701 and, as a result of the issue, the number of
AngloGold Ashanti shares in issue as at that date would have been
351,068,143.
10 As a result of the discount of the subscription price to the recent
trading prices of AngloGold Ashanti`s ordinary shares and ADSs, the
terms of the $1,000,000,000, 2.375 percent guaranteed convertible
bonds issued by AngloGold Ashanti Holdings plc provide that the
conversion price will be adjusted so that additional AngloGold
Ashanti ADSs will be issuable upon conversion. This adjustment will
have an impact on AngloGold Ashanti`s income statement for the value
change in the embedded derivative. In addition, pursuant to the
terms of our share incentive scheme, Bonus share plan and Long-term
incentive plan, and the exercise of the E ordinary shares issued to
the Bokamoso ESOP Trust the options granted under these plans will
be adjusted by the dilutive affect. These adjustments will be
accounted for as modifications calculated by using the fair value of
these options at the closing price of the rights offer. As a
result, we will incur additional compensation expense under IFRS
commencing in the third quarter of fiscal 2008.
Salient dates
The salient dates of the rights offer are set out below:
2008
Last day to trade in AngloGold Ashanti shares in order
to qualify to participate in the rights offer (cum
rights offer entitlement) on Friday, 30 May
AngloGold Ashanti shares trade ex the rights offer
entitlement from commencement of trade on Monday, 2 June
Listing of and trading in letters of allocation on JSE
from commencement of trade on Monday, 2 June
Record date for holders of AngloGold Ashanti shares to
participate in the rights offer on Friday, 6 June
Circular posted and form of instruction issued to
certificated shareholders on Monday, 9 June
Holders of AngloGold Ashanti shares in dematerialised
form will have their accounts at their CSDP or broker
credited with their rights offer entitlement on Monday, 9 June
Holders of AngloGold Ashanti shares in certificated form
will have their rights offer entitlement created in
electronic form and held at Computershare on Monday, 9 June
Rights offer opens at 09:00 on Monday, 9 June
Last day for trading in letters of allocation on JSE in
order to be settled by 17:00 on Friday, 4 July 2008 on Friday, 27 June
Listing and trading of rights offer shares on JSE
at 09:00 on Monday, 30 June
Rights offer closes at 12:00 on Friday, 4 July
Forms of instruction including cheques in respect of
certificated shareholders to be lodged by 12:00 on
(see notes 4 and 5) Friday, 4 July
Record date for letters of allocation on Friday, 4 July
Entitlement in respect of the rights offer available on Monday, 7 July
Rights offer shares issued and posted to holders of
AngloGold Ashanti shares in certificated form on
or about Monday, 7 July
Accounts of holders of AngloGold Ashanti shares in
dematerialised form updated and credited/debited at
their CSDP or broker on Monday, 7 July
Results of the rights offer and basis of allocation of
excess applications published on SENS on or about Monday, 7 July
Results of the rights offer and basis of allocation of
excess applications published in the South African
press on or about Tuesday, 8 July
Share certificates in respect of excess shares allocated
posted to holders of AngloGold Ashanti shares in
certificated form on or about Friday, 11 July
Accounts of holders of AngloGold Ashanti shares in
dematerialised form updated in respect of excess shares
allocated at their CSDP or broker on Friday, 11 July
Notes
1 All times indicated are South African times.
2 Share certificates in respect of AngloGold Ashanti shares may not
be dematerialised or rematerialised between Monday, 2 June 2008 and
Friday, 6 June 2008, both days inclusive.
3 CSDPs effect delivery on a "delivery against payment method", in
respect of holders of dematerialised AngloGold Ashanti shares.
4 If you are a dematerialised holder of AngloGold Ashanti shares, you
are required to notify your duly appointed CSDP or broker of your
acceptance of the rights offer in the manner and time stipulated in
the custody agreement.
6 Documentation and further announcement
A circular providing full details of the rights offer and incorporating
the form of instruction to holders of AngloGold Ashanti shares in certificated
form will be posted to such shareholders located outside of the United States
on or about 9 June 2008. The circular will be available on AngloGold Ashanti`s
website at www.anglogoldashanti.com on or about 27 May 2008. Copies of the
circular can be obtained during normal business hours from the opening of the
rights offer to the closing of the rights offer from AngloGold Ashanti at 76
Jeppe Street, Johannesburg and the company`s transfer secretaries,
Computershare, 70 Marshall Street, Johannesburg 2001. In the United States,
the rights offer will be made pursuant to a registration statement on Form F-3
on file with the U.S. Securities and Exchange Commission and the related U.S.
prospectus.
7 Withdrawal of cautionary announcement
The cautionary announcement dated 6 May 2008 is hereby withdrawn.
ENDS
Johannesburg
23 May 2008
Financial adviser: UBS Limited
Underwriters and bookrunners: Goldman Sachs International and UBS Limited
Underwriter and lead manager: Morgan Stanley & Co. International plc
Underwriter and co-manager: J.P. Morgan Securities Ltd.
South African legal advisers: Taback and Associates (Pty) Limited
United States of America and United Kingdom legal advisers: Shearman &
Sterling LLP
Australian legal advisers: Allens Arthur Robinson
Ghanaian legal advisers: JLD&MB Legal Consultancy
Underwriters` South African legal advisers: Bowman Gilfillan Inc.
Underwriters` United States of America legal advisers: Davis Polk &
Wardwell
Reporting accountants and auditors: Ernst & Young Inc
JSE Independent transaction sponsor: The Standard Bank of South Africa
Limited
JSE sponsor: UBS South Africa (Pty) Limited
Ghanaian sponsoring broker: Merban Stockbrokers Limited
Goldman Sachs International, Morgan Stanley & Co. International plc and
J.P. Morgan Securities Ltd., which are regulated in the United Kingdom by the
Financial Services Authority, are acting for AngloGold Ashanti and no-one else
in connection with the rights offer and will not be responsible to anyone
other than AngloGold Ashanti for providing the protections afforded to clients
of Goldman Sachs International, Morgan Stanley & Co. International plc and
J.P. Morgan Securities Ltd. nor for providing advice in connection with the
rights offer. UBS Limited is acting for AngloGold Ashanti and no-one else in
connection with the rights offer and will not be responsible to anyone other
than AngloGold Ashanti for providing the protections afforded to clients of
UBS Limited nor for providing advice in connection with the rights offer.
This announcement shall not constitute an offer to sell or the solicitation
of an offer to buy securities, nor shall there be any sale of the securities
described herein, in any jurisdiction, including the United States, in which
such offer, solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of such jurisdiction.
The rights offer described in this announcement will only be addressed to
and directed at persons in member states of the European Economic Area, or
EEA, who are "Qualified Investors" within the meaning of Article 2(1)(e) of
the European Parliament and Council Directive 2003/71/EC, including any
measure implementing such Directive in any member state of the EEA (the
"Prospectus Directive"). In addition, in the United Kingdom, the rights offer
will only be addressed to and directed at (1) Qualified Investors who are
investment professionals falling within Article 19(5) of the Financial
Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Order"),
or high net worth entities falling within Article 49(2)(a)-(d) of the Order or
(2) persons to whom it may otherwise lawfully be communicated (all such
persons together being referred to as "Relevant Persons"). The new AngloGold
Ashanti shares will only be available to, and any invitation, offer or
agreement to subscribe, purchase or otherwise acquire such securities will be
engaged in only with, (1) in the United Kingdom, Relevant Persons and (2) in
any member state of the EEA other than the United Kingdom, Qualified
Investors. In addition, due to restrictions under securities laws, the rights
offer will not be available to persons who are residents in Japan. The rights
offer will also not be addressed to, or directed at, holders of AngloGold
Ashanti GhDSs in Ghana or holders of AngloGold Ashanti CDIs who are resident
outside of Australia. The rights attributable to holders of AngloGold Ashanti
shares, GhDSs and CDIs who are excluded from the offer will, if a premium can
be obtained over the expenses of such sale, be sold on the JSE as soon as
practicable and such proceeds will then be remitted to the holders of such
AngloGold Ashanti securities.
AngloGold Ashanti has filed a registration statement in the United States
under the Securities Act of 1933, as amended, in connection with the offer and
sale of the securities described herein and intends to register the securities
described herein for offer and sale in the United States. Any public offering
of securities to be made in the United States will be made by means of a
prospectus and a related prospectus supplement that form part of this
registration statement and that will contain detailed information about
AngloGold Ashanti and its management, as well as financial statements. Such
prospectus may be obtained from AngloGold Ashanti at 76 Jeppe Street, Newtown,
Johannesburg, South Africa.
This announcement includes "forward-looking information" within the meaning
of Section 27A of the Securities Act, and Section 21E of the Securities
Exchange Act of 1934, as amended. All statements other than statements of
historical fact are, or may be deemed to be, forward-looking statements,
including, without limitation those concerning: AngloGold Ashanti`s strategy
to reduce its gold hedging position, including the extent and effect of the
reduction; the economic outlook for the gold mining industry; expectations
regarding gold prices, production, costs and other operating results; growth
prospects and outlook of AngloGold Ashanti`s operations, individually or in
the aggregate, including the completion and commencement of commercial
operations at AngloGold Ashanti`s exploration and production projects and the
completion of acquisitions and dispositions; AngloGold Ashanti`s liquidity and
capital resources and expenditure; and the outcome and consequences of any
pending litigation proceedings. These forward-looking statements are not
based on historical facts, but rather reflect AngloGold Ashanti`s current
expectations concerning future results and events and generally may be
identified by the use of forward-looking words or phrases such as "believe",
"aim", "expect", "anticipate", "intend", "foresee", "forecast", "likely",
"should", "planned", "may", "estimated", "potential" or other similar words
and phrases. Similarly, statements that describe AngloGold Ashanti`s
objectives, plans or goals are or may be forward-looking statements.
These forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause the AngloGold Ashanti`s actual
results, performance or achievements to differ materially from the anticipated
results, performance or achievements expressed or implied by these forward-
looking statements. Although AngloGold Ashanti believes that the expectations
reflected in these forward-looking statements are reasonable, no assurance can
be given that such expectations will prove to have been correct.
For a discussion of such risk factors, shareholders should refer to the
annual report on Form 20-F for the year ended 31 December 2007, which was
filed with the Securities and Exchange Commission on 19 May 2008 and, when
available, the rights offer circular. These factors are not necessarily all
of the important factors that could cause AngloGold Ashanti`s actual results
to differ materially from those expressed in any forward-looking statements.
Other unknown or unpredictable factors could also have material adverse
effects on future results.
In connection with the rights offer, the underwriters (or persons acting on
behalf of any underwriters) may engage in trading activities for the sole
purpose of hedging their commitments under the underwriting agreement between
AngloGold Ashanti and the underwriters. Such activity may include purchases
and sales of securities of AngloGold Ashanti (including shares, ADSs, share
rights and ADS rights, and derivatives related thereto) and related or other
securities and instruments, short sales of AngloGold Ashanti securities,
purchases in the open market to cover positions created by short sales, and
the purchase and sale of over-the-counter derivatives and listed options and
futures transactions. As a result of such activities, the price of such
securities may be lower or higher than the price that might otherwise exist in
the absence of such activities. If these activities are commenced, they may be
discontinued at any time at the sole discretion of the underwriters and
without notice.
Date: 23/05/2008 08:18:01 Produced by the JSE SENS Department.
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completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
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information disseminated through SENS.
