/ 3 August 2000

SLIM HOPE FOR ASHTON RESCUE

ASHTON Mining Ltd shares are struggling to top the A$1.62 a share bid from De Beers as traders bet that a rival offer is unlikely to emerge. The shares touched A$1.64 briefly after the bid was announced at the beginning of the week, but have only peaked at A$1.62 in the two trading days since the announcement. One of the world’s largest miners Rio Tinto Ltd/Plc is the only company perceived to have enough to gain to even contemplate a counterbid to De Beers’ A$522 million offer, but analysts said the chances of this were slim. It is also Ashton’s joint venture partner in the Argyle diamond mine, the world’s largest diamond mine by volume. Argyle’s strategic value to De Beers, offering it geographic and product expansion, is pegged as the reason it will pay A$1.62 a share, 42 percent above Ashton’s average price in the 30 days before the bid and well over its price of 70 cents a year ago. Analysts said the key impact for Rio Tinto of De Beers taking the rest of Argyle was a plan to withdraw its share of diamonds from Argyle Diamond Sales, through which Rio Tinto had expected to market its share of the Canadian Diavik project diamonds. – Reuters