Deal is in line with Target speculation
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HARMONY Gold Mining's acquisition of an 11,5% stake in Avgold, announced yesterday, is in line with speculation that the group, together with Armgold, aims to take control of Avgold's Target gold mine in the Free State. This mine would add a longterm asset to Harmony's portfolio and fit in with efforts to consolidate operations in that area.
The deal follows Harmony and Armgold's acquisition of a 34,5% stake in Anglovaal Mining, which had a 42,5% stake in Avgold two months ago. If the Competition Tribunal approves the Harmony-Armgold merger today, the group will own about 26% of Target through Avgold.
Harmony marketing director Ferdi Dippenaar would not say if the group had a strategy to get a larger stake in Target.
The group is likely to have difficulty increasing its stake much, however, as Avgold shares are tightly held.
Harmony said it was getting the 11,5% stake from Anglo American in exchange for rights to Harmony shares, which Anglo would sell for about $80m.
Jul 16 2003 07:47:58:000AM Carli Lourens Business Day 1st Edition
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