Ghana’s Parliament gave its long-awaited approval on Wednesday to a merger between Ashanti Goldfields and the South African-owned Anglogold that would create the world’s largest gold producer, parliamentary sources said.
The controversial deal was to have been finalised before December 12 but the proposal languished in parliament, where the main opposition party mounted a campaign to have the merger declared illegal.
Minister of Mines Cecilia Bannerman moved on Wednesday morning to have the resolution sanctioning the merger adopted, which was approved by the parliamentary speaker who called for a voice vote.
Minority leader Alban Bagbin sought to challenge the voice vote by demanding a head count in accordance with parliamentary procedure, but was overruled by the speaker, according to a transcript of the parliamentary session.
”The benefits to Ghana include the increased market capitalisation on the Ghana stock exchange, envisaged job creation, increased revenue mobilisation for government and anticipated community development,” said Albert Boadi-Mensah, the chairman of the parliamentary committee on mines.
The opposition National Democratic Congress (NDC) had said December 9 that the merger violated the country’s mineral and mining law, which requires a mandatory 10% participation by the government in every mining company operating in Ghana.
”The Anglogold agreement is a sell-out,” said Seidu Adamu, the ranking member of the shadow mines and energy committee.
”There was a lack of proper evaluation of Ashanti Goldfields’ assets, and the transaction agreement and the supporting documents on the agreement were not made available to parliament for proper scrutiny to ensure informed judgment on the agreement.
”It was wrong to grant mining concessions to a company for several years and go into an agreement when everything was not transparent,” he said.
There was no immediate reaction from Ashanti or Anglogold.
Ashanti, burdened by high operating costs and problems raising cash to pay short-term debt, received the go-ahead from the Ghana government in November to merge with Anglogold, 51% owned by South African mining giant Anglo American.
The government of Ghana, owner of a 17,2% golden share in the mine, has already confirmed the sale for an all-share price of $1,42-billion.
The government’s share in the new company, to be known as AngloGold Ashanti, will equal 3,4%, with a value of R340-million.
The merged company would produce 7,5-million ounces of gold a year and become the world’s largest gold producer with 26 mines on four continents. – Sapa-AFP