MONDAY, 9.00AM:
BRITAIN’s Sunday Telegraph revealed on Sunday that Anglo American plans this week to merge its gold mining operations into a single R20-billion company, to combat pressure from falling gold prices.
Although Anglo American refused to comment, interim results are scheduled to be announced on Tuesday. It is expected that the opportunity will be used to announce a plan to follow the lead of Gencor and Gold Fields into abolishing separate listings for mines, and rationalising operations. The driving force behind the deal is said to be gold division chief Bobby Godsell, who has already announced plans to scale back on marginal operations, and to cut back production costs to $250 per ounce.
The pending rationalisation may help explain Anglo American’s hostility towards attempts by Golfields SA and Gencor to use the mine Driefontein Consolidated as the vehicle for their own multi-billion rand gold mining merger. Anglo, a substantial minority shareholder in Driefontein, may want the mine for its own purposes, merging it with the neighbouring mine Western Deep Levels, an Anglo subsidiary.
Business Day speculated on Monday morning that the vehicle for the new Anglo plans may be Vaal Reefs, because a cautionary note was issued to shareholders recently.