| Wed 28 Jan 2009, 7:18 | | ANG - Anglogold Ashanti To Sell Its 33.33% Joint Venture Interest In The |
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ANG
ANANO
ANG - Anglogold Ashanti To Sell Its 33.33% Joint Venture Interest In The
Boddington Gold Mine To Newmont Mining Corporation
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")
ANGLOGOLD ASHANTI to sell ITS 33.33% JOINT VENTURE INTEREST IN THE BODDINGTON
GOLD MINE TO NEWMONT MINING CORPORATION
AngloGold Ashanti Limited ("AngloGold Ashanti" or "the Company") is pleased to
announce that it has agreed to sell its indirect 33.33% joint venture interest
in the Boddington Gold Mine in Western Australia to Newmont Mining Corporation
for an aggregate consideration of up to approximately US$1.1 billion (the
"Transaction").
The Transaction is consistent with AngloGold Ashanti`s strategy of focusing
on its core, controlled asset portfolio and realising value from any minority,
non-managed interests as and when appropriate. It will also immediately
strengthen the Company`s balance sheet, result in lower financing costs due to
early repayment of the recently announced US$1.0 billion bridge facility and
create additional flexibility to participate in further investment and growth
opportunities.
Commenting on the Transaction, Mark Cutifani, CEO of AngloGold Ashanti, said
"The sale of our 33.33% interest in the Boddington Gold Mine is another
important step forward in focusing our portfolio on our strategic asset base.
The Transaction delivers total consideration of up to approximately US$1.1
billion and also reduces our budgeted capital spend by some A$269 million in
2009. This provides us with funding flexibility to deliver on our growth
opportunities, while we also continue to reduce our hedge book and deliver on
our commitment to create compelling value for our shareholders. This Transaction
leaves the company positioned extremely well to take advantage of any new
opportunities in the current economic and financing environment."
The Transaction consideration consists of three components:
- US$750 million payable in cash upon the fulfillment of all conditions
precedent to the Transaction ("Completion");
- US$240 million that will be settled, subject to Newmont`s election on
1 December 2009, either in cash payable on 31 December 2009, or Newmont shares
to be issued on or prior to 10 December 2009, or a combination of cash (payable
on 31 December 2009) and Newmont shares (issued on or before 10 December 2009).
Any Newmont shares issued to AngloGold Ashanti will be subject to registration
rights that will give AngloGold Ashanti the flexibility to dispose of the shares
in the market; and
- A royalty calculated as the product of, 50% of the amount by which the
average spot gold price in each quarter exceeds the cash costs of the Boddington
Gold Mine, as reported by Newmont, by US$600 per ounce and, one-third of total
gold production from the Boddington Gold mine in that quarter. The royalty is
payable in each quarter from and after the second quarter in 2010 that the above
threshold is achieved and subject to an aggregate cap of US$100 million in
royalty payments.
At Completion, AngloGold Ashanti will be reimbursed for all contributions
made to the joint venture after 1 January 2009 and AngloGold Ashanti will pay
Newmont US$8 million in respect of its share of working capital at 1 January
2009.
Newmont has informed AngloGold Ashanti that it has received a commitment for
a US$1.0 billion bridge facility in order to fund the Transaction and associated
capital expenditure for the Boddington Gold Mine. This financing remains subject
to customary closing conditions.
Completion is subject to conditions precedent, including:
- finalisation of Newmont`s financing;
- the receipt, to the extent required, of Ministerial consents and/or other
Government agency approvals in Australia;
- the approvals of the South African Reserve Bank and the Australian Foreign
Investment Review Board;
- the execution by certain third parties of agreements with respect to the
assignment of material tenements and land as related to the Boddington Gold
Mine; and
- the receipt of certain other applicable third party approvals and consents.
It is anticipated that the conditions precedent will be satisfied and
Completion will occur in approximately 40 to 50 days time.
The table below sets out the pro forma financial effects of the Transaction
on AngloGold Ashanti`s basic earnings per share, headline earnings per share,
net asset value and tangible net asset value per share, based on AngloGold
Ashanti`s last published financial statements for the nine months ended 30
September 2008. The estimated value of net assets that are the subject of the
Transaction is approximately US$789 million (A$980 million at an A$:US$ exchange
rate of 0.8054) as at 30 September 2008.
The pro forma financial effects are provided in compliance with the Listings
Requirements of the JSE Limited. The pro forma financial effects have been
prepared for illustrative purposes only and, because of their nature, may not
give a true reflection of AngloGold Ashanti`s financial position, changes in
equity, and results of operations or cash flows. It is important to note that
the Boddington Gold Mine was under development during the course of 2008 and
therefore did not make any profit or loss during the period but is scheduled to
come into production during the course of 2009. The pro forma financial effects
are the responsibility of the directors of AngloGold Ashanti.
Per AngloGold Ashanti Actual before the Pro forma after the Percentage
share (cents) Transaction (1) Transaction (1) change
Basic earnings (2)(3) (59) (59) 0.0%
Headline earnings(2)(3) (87) (87) 0.0%
Net asset value(4) 1,044 1,097 5.1%
Tangible net asset
Value(4) 931 1,015 9.0%
Notes:
1. Based on AngloGold Ashanti`s last published financial statements as at
30 September 2008.
2. Basic earnings per share and headline earnings per share are based on
304.0 million shares, being the weighted average number of shares in
issue for the 9 months ended 30 September 2008.
3. The Boddington Gold Mine is not yet in production and as such its
disposal has no income statement effects.
4. Net asset value per share and tangible net asset value per share are
based on 354.7 million shares, being the total number of shares in
issue as at 30 September 2008.
ENDS
27 January 2008
JSE Sponsor - UBS
Contacts
South Africa
Himesh Persotam (Investor Relations) Tel: +27(0)11637-6647
Mobile: +27(0)82 339 3890 E-mail:hpersotam@AngloGoldAshanti.com
Alan Fine (Media) Tel:+27(0)11 637-6383 Mobile:+27(0)83 250 0757
E-mail:afine@AngloGoldAshanti.com
Joanne Jones (Media) Tel:+27(0)11 637- 6813 Mobile:+27(0)82 896 0306
E-mail:jjones@AngloGoldAshanti.com
Legal Advisers:
Allens Arthur Robinson
Shearman & Sterling LLP
Certain statements made in this communication, including, without limitation,
those concerning the proposed sale of AngloGold Ashanti`s joint venture interest
in the Boddington Gold Mine, the benefits anticipated from the proposed sale and
the timing of the satisfaction of the conditions precedent to the transaction,
the timing of the repayment of AngloGold Ashanti`s bridge financing and
AngloGold Ashanti`s strategy to reduce its gold hedging position including the
extent and effects of the reduction, contain certain forward-looking statements
regarding AngloGold Ashanti`s operations, economic performance and financial
condition. Although AngloGold Ashanti believes that the expectations reflected
in such forward-looking statements are reasonable, no assurance can be given
that such expectations will prove to have been correct. Accordingly, results
could differ materially from those set out in the forward-looking statements as
a result of unanticipated delays or difficulties in obtaining regulatory or
third party approvals and other factors. For a discussion of such factors, that
may affect AngloGold Ashanti, including changes in economic and market
conditions, success of business and operating initiatives, changes in the
regulatory environment and other government actions, fluctuations in gold prices
and exchange rates, and business and operational risk management, refer to
AngloGold Ashanti`s annual report for the year ended 31 December 2007, which was
distributed to shareholders on 31 March 2008, and report to shareholders for the
quarter and nine months ended 30 September 2008, which was distributed to
shareholders on 30 October 2008. AngloGold Ashanti undertakes no obligation to
update publicly or release any revisions to these forward-looking statements to
reflect events or circumstances after today`s date or to reflect the occurrence
of unanticipated events. All subsequent written or oral forward-looking
statements attributable to AngloGold Ashanti or any person acting on its behalf
are qualified by the cautionary statements herein.
AngloGold Ashanti posts information that is important to investors on the
main page of its website at www.anglogoldashanti.com and under the "Investors"
tab on the main page. This information is updated regularly. Investors should
visit this website to obtain important information about AngloGold Ashanti.
Date: 28/01/2009 07:18:04 Produced by the JSE SENS Department.
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