| Wed 28 Mar 2001, 0:00 | | Anglo American Proposals To Anaconda |
|
ANGLO AMERICAN PLC
Anglo American plc ("Anglo American") has today informed Anaconda Nickel
Limited ("Anaconda") that it intends to requisition an Extraordinary General
Meeting ("EGM") of Anaconda shareholders to propose a change in the composition
of the board, including the removal of the company's chief executive officer
("CEO") and chief financial officer ("CFO").
As part of its proposals, Anglo American will be recommending the Anaconda
board undertake a rights issue to raise A$100 million for interim working
capital pending a full strategic review of the company, its prospects and
financial structure.
At the EGM shareholders would be asked to consider resolutions for the removal
of all directors of Anaconda other than Messrs Campbell, Glasenberg, Linegar,
Morrison and Stewart.
If Anglo American's proposals are approved and implemented, Anglo American
would be prepared to support the rights issue on normal commercial terms and
conditions.
If Anglo American's proposals are not approved, Anglo American will not provide
any further financial support to Anaconda, unless and until the board and
senior corporate management is reconstituted. Anglo American will continue to
meet its pre-existing contractual commitments.
Tony Trahar, CEO of Anglo American plc, explains, "Anglo American has, through
an approach to the Chairman of Anaconda, sought to resolve management issues
without resort to a public process, but this approach has been unsuccessful.
Anglo American has therefore reluctantly decided to take this initiative and
firmly believes it is acting in the best interests of all Anaconda
shareholders."
"Anglo American has been concerned for some time by the poor operating and
financial performance of Anaconda," he said.
"Projections and financial forecasts made at the time of Anglo American's
investment in 1999, and subsequently, have not been achieved. Anglo American
has lost confidence in the Anaconda board, as currently constituted, as well as
the CEO and the CFO, to achieve timely ramp-up of the Murrin Murrin plant and
the transition of the company to a competitive and reliable supplier of quality
nickel. In Anglo American's view, Anaconda's financial position (despite
significant cash injection by Anglo American and others) prevents it from
undertaking key capital expenditures or pursuing other value-adding
opportunities."
The Proposals
Under Anglo American's proposals, the only resolution to be voted on at the EGM
will be the removal from office of the CEO, CFO and all members of the board
with the exception of Messrs Campbell, Glasenberg, Linegar, Morrison and
Stewart.
In addition, Anglo will propose the following:
An additional Anglo nominee will be appointed to the board. Following this
person's appointment, Mr Stewart will resign from the board.
James Campbell will be appointed as interim Chairman. The company will
immediately seek to identify, with the assistance of a reputable international
search consultant, a suitably qualified individual to assume the Chairmanship
on a permanent basis, at which time Dr Campbell will resume his role as a
non-executive director.
An interim CEO, if possible from within the company, and interim CFO will be
appointed pending identification, through an international search consultant,
of suitably qualified individuals to take up these roles on a permanent basis.
The permanent CEO will be invited to join the board.
In due course the new board would seek to appoint an additional non-executive
director.
A rights issue to raise A$100 million to provide interim working capital. The
terms of the rights issue are yet to be agreed, but it is proposed that they
would reflect those terms which are typical for an issue of this size.
An executive committee of the board, which shall include the interim CEO and
CFO, be established and mandated to conduct a strategic review and to report
back to shareholders on key conclusions and recommendations as soon as
possible, but in any event, within 180 days.
The strategic review will include:
a full and thorough evaluation of the status of and prospects for Murrin Murrin
phase one;
a review of current business development and expansion initiatives; and
an evaluation of the financial structure of Anaconda;
Trahar concludes: "Anglo American's proposals are obviously far reaching but
are essential. They provide all shareholders with the opportunity to vote on
changes to management and to take up their entitlement under the rights issue.
They provide Anaconda with the highest probability of being able to crystallise
shareholder value and regain the support of the investing community," he said.
Anglo American will shortly serve Anaconda with formal notice requisitioning
the EGM and will thereafter write to Anaconda shareholders setting out its
position and the terms and conditions of its proposal. Anglo American may
withdraw its proposals, including its support of the rights issue, should
Anaconda seek to unduly frustrate or delay shareholders' consideration of these
proposals.
For further information:
Investor and Media Relations
Anne Dunn
Anglo American
Mob: +27 82 448 2684
Kate Kerrison Felicity Allen
Gavin Anderson & Company Gavin Anderson & Company
+ 61 2 9552 4499 + 61 3 9654 6555
Nick von Schirnding Marion Dixon
Anglo American, London Anglo American, Johannesburg
+ 44 7771 737 055 + 27 11 638 3001
Notes to Editors:
Anglo American plc is a global leader in the mining and natural resource
sectors. It has significant and focused interests in gold, platinum, diamonds,
coal, base and ferrous metals, industrial minerals and forest products, as well
as financial and technological strength. The Group is geographically diverse,
with operations and developments in Africa, Europe, South and North America and
Australia. Anglo American represents a powerful world of resources.
Anaconda, an Australian publicly traded company in which Anglo American
currently holds 25.4%, has interests in nickel and cobalt operations in Western
Australia. It is currently developing the Murrin Murrin laterite nickel
project in Western Australia, which has begun production and is in the ramp-up
phase, with other sites under feasibility study or consideration.
Anglo American Corporation of South Africa Limited
Corporate Communications Department
3rd Floor 55 Marshall Street Johannesburg 2001 PO Box 61587 Marshalltown
2107 South Africa
Tel +27 (0)11 638 9111 Fax +27 (0)11 638 3771 Telex 4-87167 Telegraph
Anmercosa
www.angloamerican.co.uk
A member of the Anglo American plc group
