Anglo Pt gains on cautionary

[] — SHARES in Anglo Platinum, the 84%-owned listed subsidiary of Anglo American, gained 3.5% on October 29 following an announcement it was in negotiations “that may have a material” effect on its share price.

The share was 0.7% higher in early morning trade Monday at R698.48.

For negotiations to have “a material effect” normally means that more than 10% of the value of its shares could be affected, an analyst said.

However, there was no clarity as to what the negotiations could relate. There was speculation the announcement could relate to another dispute about ownership of certain mineral rights which has become a source of bad publicity for the South African government. “There’s talk this could be quite a negative thing,” the analyst said

The announcement comes a week before Royal Bafokeng Platinum (RBPlat), in whose mine – Bafokeng Rasimone Platinum Mine (BRPM) – Anglo Platinum will have a one third stake, lists on the JSE.

Earlier analysts speculated that Anglo Platinum may move to enforce some kind of pre-emptive right over shares in the mine after it emerged BRPM’s controlling shareholder, Royal Bafokeng Holdings, was willing to sell its stake to Impala Platinum.

Were Impala Platinum to resuscitate its offer, this would possibly leave Anglo Platinum as “the dog in the manger” as its minority role in BRPM has been described in the past.

Another option was that Anglo American was negotiating to take out the remaining shares, about 15% in Anglo Platinum, that it did not already own.

However, analysts were dismissive of this possibility as Anglo American would have had to issue its own cautionary announcement to shareholders.