THURSDAY, 11.30AM
JOHANNESBURG Consolidated Investments and Anglo American on Wednesday killed two birds with one stone when they announced that Anglo is to sell its entire 26,8% stake in British multinational Lonrho to JCI for R2,5-billion>
The deal follows the failure of merger talks between JCI and Lonrho, and resuscitates the group’s international ambitions while solving Anglo’s problem of what to do with its Lonrho stake after the European Commission earlier this year ruled it had to reduce its holding to below 10%.
The deal, which relates to a combined holding of 211-million Lonrho shares held by Anglo, De Beers and Southern Life, still requires EC and shareholder approval. The deal was clinched at R11,64 (155p) a share, well below the 180p Anglo paid last year when it acquired the shares from former Lonrho chairman Dieter Bock. This translates into a R450-million loss to Anglo, but it is believed this is being offset against the profit the group made on the sale of its stake in JCI to Mzi Khumalo ealier this year.
JCI has six months to raise the R2,5-billion to complete the deal which, if successful, will make JCI the single largest Lonrho shareholder.