IDC reversal on Kumba seen as product of talks
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Government keen to resolve dispute
Resources Correspondent
THE Industrial Development Corporation (IDC) has backtracked on its opposition to Anglo American building up a controlling stake in Kumba, just days before the sixth day of hearngs by the Competition Tribunal where the corporation is contesting Anglo's intention to take a controlling stake in Kumba Resources.
The hearing reconvenes today after IDC chairwoman Wendy Luhabe issued a statement on Friday in which the development organisation departed from its position presented at previous tribunal hearings.
"The IDC's objective is not to take control of Kumba, either on its own behalf or in support of black economic empowerment shareholders," Luhabe said.
Anglo CEO Tony Trahar, giving evidence at the proceedings, has said that Anglo had the agreement of both President Thabo Mbeki and Trade and Industry Minister Alec Erwin to the company's plans to build its stake in Kumba to 49%.
Analysts and industry sources are convinced that there has been a good deal of quiet diplomacy on the part of government which may have led to the statement.
Government is keen to resolve the dispute between Anglo and the IDC for both economic and political reasons. The sooner a consolidation of SA's iron ore reserves takes place, the more chance SA has of securing buyers for its ore in a competitive global market. Government too would be keen to avoid any impasse between Anglo and the IDC which could leave the tribunal to make a decision on the IDC argument, which clashes with stated government empowerment policy.
The IDC statement made it plain, though, that it still wants to see meaningful black empowerment participation in Kumba.
Anglo refused to be drawn on speculation that top Anglo executives might have held talks and were willing to negotiate a compromise deal on Kumba .
Michael Spicer, executive director of corporate affairs, reiterated that for Anglo to invest further in Kumba the company in accordance with its set investment criteria it would need to have a significant and controlling interest.
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