Anglo tightens its grip on Kumba as Tiso flees deb
Anglo tightens its grip on Kumba as Tiso flees debt
October 27, 2003
By Sherilee Bridge
Johannesburg - Anglo American, the world's second-biggest resources group, strengthened its hold on diversified mining group Kumba Resources on Friday, when it bought a 4.2 percent stake from black economic empowerment stakeholder Tiso Kgalagadi.
The Tiso Kgalagadi consortium, led by Tiso Capital, said on Friday that it could no longer meet its funding obligations.
"The ongoing cost of funding the debt and movements in the Kumba share price resulted in the consortium funding becoming unsustainable, and made it necessary for the consortium to restructure its arrangements with Investec," it said in a news release on Friday.
"Following this restructuring, the arrangements between Investec and Anglo American have been triggered and 4.2 percent of Kumba sold to Anglo American. The consortium retains an ungeared shareholding of 0.6 percent in Kumba," it said.
Anglo American had not released any official notification of the acquisition by last night.
While no figures were disclosed, the stake could have fetched more than R400 million - the price Tiso Kgalagadi paid for the full stake in December 2001.
The sale of the stake could again spark a battle between state-owned development financier the Industrial Development Corporation (IDC) and Anglo American.
The IDC and Anglo American locked horns during the year-long Competition Tribunal investigation into whether Anglo American's increased holding in Kumba would impinge on competition laws.
Anglo was given Competition Tribunal approval last month to take its stake in Kumba up to as much as 49 percent. It then held 21.9 percent and had options to take its holding to 35 percent.
Arguing that Anglo American could limit black economic empowerment participation in Kumba by tying up the majority of its shares, the IDC may have grounds to again question Anglo's role in the consolidation of the iron ore assets of the Northern Cape.
Shares in Anglo American closed 5c lower at R134.80 in Johannesburg on Friday.
Kumba Resources stock ended the week 26c weaker at R34.99.
Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information.
