| Thu 21 Sep 2006, 15:28 | | Anglogold Ashanti - Anglogold Ashanti enters into |
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ANG
ANANO
Anglogold Ashanti - Anglogold Ashanti enters into strategic alliance in
Russia with Polymetal and agrees to acquire assets from Trans-Siberian Gold
AngloGold Ashanti
(Registration number 1944/017354/06)
(Incorporated in the Republic of South Africa)
("AngloGold")
ISIN: ZAE000043485
JSE Share code: ANG
AGA17.06
21 September 2006
AngloGold Ashanti enters into strategic alliance in Russia with Polymetal
and agrees to acquire assets from Trans-Siberian Gold
AngloGold Ashanti is pleased to announce that it has today agreed to enter
into a 50:50 strategic alliance with the Russian gold and silver producer,
OAO Inter-Regional Research and Production Association Polymetal
("Polymetal"). In terms of this agreement, AngloGold Ashanti and Polymetal
will cooperate in exploration, acquisition and development of gold mining
opportunities within the Russian Federation (the "Strategic Alliance").
Russia is already one of the world"s leading gold producing nations with
significant long term growth potential. AngloGold Ashanti therefore
identified Russia as a key target for growth early in 2003 and made an
investment in the AIM listed gold company Trans-Siberian Gold plc ("TSG")
during 2004. AngloGold Ashanti believes that a partnership with a well
established Russian gold producer provides the best platform for further
development of its activities in Russia. Polymetal, as Russia"s second
largest gold producer has considerable, proven operating and management
expertise and shares AngloGold Ashanti"s ambition of expanding its
operating footprint in Russia. This will complement AngloGold Ashanti"s
investment in TSG.
AngloGold Ashanti is also pleased to announce that it has submitted an
offer to the Board of TSG to acquire all of TSG"s interests in OOO GRK
Amikan ("Amikan") and OOO Artel Staratelei Angarskaya Proizvodstvennaya
Kompania ("AS APK") for a consideration of approximately US$40 million and
that this offer has been accepted and recommended by the TSG Board (the
"TSG Transaction"). Amikan holds the comprehensive licence in respect of
the Veduga deposit and a 540 km2 exploration licence surrounding Veduga,
whilst AS APK holds the licence for exploration and development of the
Bogunay deposit. Both Veduga and Bogunay are located in the Krasnoyarsk
region. Veduga is an advanced stage exploration project at pre-feasibility
study stage and has a published, JORC compliant, Mineral Resource
containing 1.92 million ounces of Measured and Indicated Mineral Resource,
as well as 871,000 ounces of Inferred Mineral Resources, whilst Bogunay is
an early stage exploration project. Should the TSG transaction complete,
these assets will be contributed to the Strategic Alliance with Polymetal.
AngloGold Ashanti has also agreed to extend the term of its existing
technical consultancy agreement with TSG for a further two years to
1 July 2009.
AngloGold Ashanti also announces that it is in the process of terminating
the exploration alliance that it has held since March 2005 with Eurasia
Mining plc in respect of the Chita and Buryat regions of Russia in order to
avoid any conflict of interest that this may pose to the Strategic Alliance
with Polymetal.
In terms of the Strategic Alliance with Polymetal it has been agreed that
the Strategic Alliance"s interests in Russia will be divided into three
broad regions, as follows:
Exclusive Areas: This is all of Russia east of the Ural mountains excluding
the Non-Exclusive Areas referred to below. Within the Exclusive Area
AngloGold Ashanti and Polymetal will only pursue gold mining opportunities
through the Strategic Alliance. However, should the Strategic Alliance
elect not to pursue any such opportunity then the party that proposed and
was in favour of such opportunity may pursue it outside of the Strategic
Alliance.
Non-Exclusive Areas: This includes the regions of Sverdlovsk, Khabarovsk,
Magadan, Chukotka, Koryakia, Kamchatka and Irkutsk. The Strategic Alliance
will not impose any restriction upon AngloGold Ashanti or Polymetal related
to the pursuit of gold mining opportunities in the Non-Exclusive Areas.
However, the pursuit of gold mining opportunities through the Strategic
Alliance will equally be possible should both parties agree to do so.
Other Areas: This represents the rest of Russia other than the Exclusive
Areas and the Non-Exclusive Areas and is essentially all of Russia west of
the Ural mountains. In these areas either AngloGold Ashanti or Polymetal
may pursue a gold mining opportunity solely and independently, but not
together with a third party as part of a consortium, unless the Strategic
Alliance elects not to pursue such opportunity.
It is proposed that the Strategic Alliance will be equally held by
AngloGold Ashanti and Polymetal and will initially hold the assets acquired
by AngloGold Ashanti from TSG (subject to the completion of the TSG
transaction) and two greenfields exploration companies currently held by
Polymetal. These exploration companies hold the Aprelkovsko-Peshkovski
deposit located in the Chita region, and the Anenskoye deposit located in
the Krasnoyarsk region. The assets acquired from TSG as a result of the TSG
Transaction will be contributed at a value of approximately US$40 million
and the exploration companies will be contributed by Polymetal at a value
of US$16 million with an initial payment of approximately US$12 million
from Polymetal to AngloGold Ashanti. Consequently, the initial focus of the
Strategic Alliance will be Veduga, Anenskoye, Bogunay and Aprelkovsko-
Peshkovski, whilst other opportunities are pursued as and when these become
available.
The formation of the Strategic Alliance is subject to a number of
conditions precedent including appropriate corporate and regulatory
approvals, confirmatory due diligence, no material adverse change and
completion of binding documentation. Completion is expected no later than
31 January 2007.
The TSG Transaction has been approved and recommended by the TSG Board
following the receipt of an opinion from its nominated adviser that the
terms of this transaction are fair and reasonable insofar as the
shareholders of TSG are concerned. The TSG Transaction remains subject to
certain conditions precedent, including the receipt of the necessary
regulatory approvals. It is expected that these conditions can be satisfied
within a few months. TSG intends to utilise the proceeds from the TSG
Transaction, together with project finance, to fund the development of its
Asacha project.
Commenting on the Strategic Alliance, Bobby Godsell, CEO of AngloGold
Ashanti, said "We are extremely pleased to have entered into this Strategic
Alliance with Polymetal and look forward to working together to help
achieve our objective of building a meaningful gold business within
Russia". He went on further to say in regard to the TSG Transaction "We are
also delighted that we have reached an agreement with TSG that will provide
it with the focus and resources to develop its gold assets in the Kamchatka
region of Russia. I am confident that we can work together with the new
management structure in order to make this a success."
Ends.
Queries
South Africa Tel: Mobile:
E-mail:
Charles Carter +27 (0) 11 637 6385 +27 (0) 82 330 5373
cecarter@AngloGoldAshanti.com
Michael Clements +27 (0) 11 637 6647 +27 (0) 82 339 3890
mclements@AngloGoldAshanti.com
Steve Lenahan +27 (0) 11 637 6248 +27 (0) 83 308 2200
slenahan@AngloGoldAshanti.com
North America
Andrea Maxey (212) 750 7999 (646) 549 8992
amaxey@AngloGoldAshanti.com
Disclaimer
Except for historical information contained herein, there are matters
discussed in this news release that are forward-looking statements. Such
statements are only predictions and actual events or results may differ
materially. For discussion of important factors including, but not limited
to development of the Company"s business the economic outlook in the gold
mining industry, expectations regarding gold prices and production, and
other factors, which could cause actual results to differ materially from
such forward-looking statements, refer to the Company"s annual report on
the Form 20-F for the year ended 31 December 2005, dated 17 March 2006 and
which was filed with the Securities and Exchange Commission (SEC) on 20
March 2006. 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.
Date: 21/09/2006 03:28:05 PM Produced by the JSE SENS Department
