Johannesburg, South Africa — MININGREVIEW.COM — 28 January 2009 – AngloGold Ashanti Limited – one of the world’s top gold producers with 21 operations on four continents – has agreed to sell its indirect 33.33% joint venture interest in the Boddington gold mine in Western Australia to Newmont Mining Corporation for US$1.1 billion (R11 billion).
A news release issue here explained that the transaction was consistent with AngloGold Ashanti’s strategy of focusing on its core, controlled asset portfolio, and realising value from any minority, non-managed interests as and when appropriate. It would also immediately strengthen the company’s balance sheet, result in lower financing costs due to early repayment of the recently announced US$1.0 billion (R10 billion) bridge facility, and create additional flexibility to participate in further investment and growth opportunities.
Commenting on the transaction, AngloGold CEO Mark Cutifani said: “This sale is another important step forward in focusing our portfolio on our strategic asset base. It delivers total consideration of up to approximately US$1.1 billion (R11 billion) and also reduces our budgeted capital spend by some A$269 million (R1.9 billion) in 2009. This provides us with funding flexibility to deliver on our growth opportunities, while we also continue to reduce our hedge book and deliver on our commitment to create compelling value for our shareholders,” he added. “This transaction leaves the company positioned extremely well to take advantage of any new opportunities in the current economic and financing environment.”
At completion, AngloGold Ashanti will be reimbursed for all contributions made to the joint venture after 1 January 2009, and AngloGold Ashanti will pay Newmont US$8 million (R80 million) in respect of its share of working capital at 1 January 2009.
Newmont has informed AngloGold Ashanti that it has received a commitment for a US$1.0 billion (R10 billion) bridge facility in order to fund the transaction and associated capital expenditure for the Boddington gold mine. This financing remains subject to customary closing conditions.