[miningmx.com] – GOLD Fields said AngloGold Ashanti’s Iduapriem in Ghana was a potential acquisition opportunity although it cautioned that the probability was “never high” if there was a divergence in expectations between buyer and seller.
Responding to an analyst question last week, Gold Fields CEO Nick Holland observed that Iduapriem and Tarkwa used to be mined as a single orebody. It was, therefore, an example of a potential deal Gold Fields could do with AngloGold.
AngloGold Ashanti said on November 3 at its third quarter briefing that it was considering selling assets but warned bargain hunters that “the shop was not open”. It was interested in selling assets in an effort to cut net debt about $1bn.
Said Holland: “Obviously Iduapriem is contiguous to Tarkwa. In fact, if you stand above the Teberebi pit, which is one of our pits, you can actually look into their pit. It is right next to us. That used to be mined as one big ore body back in the day in 1999.
“That may present an opportunity. But the probability of doing deals is never high because it is a question of the expectations of the seller versus the expectations of the buyer”.
“So nothing may happen.
“But I think if there was a reasonable opportunity and if AngloGold wanted to recapitalise their balance sheet that could be interesting for us,” said Holland.
Iduapriem produced 15% of Continental Africa’s 1.46 million ounces in gold production, equal to 219,000 oz/year ingAngloGold’s 2013 financial year.
Elsewhere in the presentation, Holland said he didn’t want Gold Fields portflolio of mines to become too big. This follows several years of asset restructuring, involving the sale of assets such as Chucapaca in Peru.
In 2013, Gold Fields bought the Yilgarn South assets in Australia from Barrick Gold for $300m. As a result, gold produced from Australia by Gold Fields contributes 43% of the targeted 2.2 million ounces in 2014 production whilst the contribution from South Africa has fallen back following the demerger of assets into Sibanye Gold.
Holland said there were “other assets” in Africa the group might look at to as well as in South America.
“I think Venkat [Srinivasan Venkatakrishnan, CEO of AngloGold Ashanti] is clearly trying to assess what the best way forward is, and I’m sure that he is doing some restructuring of his own.
“In fact he said so. So time will tell if they in fact do anything at all,” said Holland.
