HomeCentral AfricaRandgold and AngloGold bid for Moto

Randgold and AngloGold bid for Moto

The Morila mine in
Mali – jointly owned by
AngloGold and Randgold
London, England — MININGREVIEW.COM — 17 July 2009 – Rivalling a bid from Redback Mining, Randgold Resources Limited and AngloGold Ashanti Limited have offered US$488 million (almost R4 billion) in cash and stock for Moto Goldmines Limited to access reserves in the Democratic Republic of Congo.

“The offer values Moto at C$5 a share, or 7.1% more than the Perth-based company’s C$4.67 close in Toronto yesterday,” Randgold said in a statement. “It entitles Moto’s shareholders to receive as much as US$244 million (just under R2 billion) in cash, paid by AngloGold, and about 3.9 million Randgold shares,” the statement added.

Bloomberg News reports that the deal would bolster Randgold’s reserves at a time when mining at one of its two Malian operations is due to end. Moto’s DRC project is estimated to hold as much as 22.5 million ounces of the metal.

“The offer is subject to Moto scrapping an accord with Red Back,” Randgold said, adding that it believed the bid was superior to Red Back’s C$513 million (US$456.5 million) all-stock plan.

“If you want to pick up a project of this size for this price then the DRC is the only place to go,” London-based Investec Limited analyst Jonathan Guy said by telephone to Bloomberg News. “Randgold is betting on Congo, and it may be a foolish move or a great deal, depending on the country’s political future,” he added.

Randgold said AngloGold had agreed to fund the cash part of the deal in return for an indirect 50% stake in Moto under a planned joint venture. Randgold would operate the project.

“The venture allows the companies to share the risk and rewards of operating in the DRC,” AngloGold CEO Mark Cutifani said in a separate statement. “The two have run a venture at Mali’s Morila mine for the past nine years.”