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Harmony most likely buyer of AngloGold’s Kopanang

Sep 17 2017 06:00
Lesetja Malope

Johannesburg - With two of the three initial bidders for AngloGold Ashanti’s Kopanang mine in Klerksdorp, North West, having received letters of rejection, the door seems wide open for deep-pocketed Harmony Gold to win.

One of the rejected buyers is the owner of Tau Lekoa gold mine in Orkney; the other is a member of Kopanang’s own management.

According to two independent sources close to the matter, the two local bidders were sent letters of rejection last week, leaving Harmony as the probable new owner.

An announcement in this regard will most likely be made early this week.

City Press has seen a copy of the letter sent to the two parties, indicating that their bids were unsuccessful.

AngloGold issued a statement on Friday, confirming that it had signed a memorandum of understanding with “a selected party”.

“Should the potential sale be successfully concluded, this will have a positive impact on ... restructuring. The Kopanang mine would no longer be placed on care and maintenance, but would continue to operate under the ownership of the selected party,” the statement read.

“In terms of the memorandum of understanding, it has been agreed that the severance benefits due to all Kopanang employees will be paid out by AngloGold Ashanti on the closing of the potential sale. Should the potential sale not proceed, the severance benefits will be paid to employees on conclusion of the restructuring process that was announced on June 28, and the Kopanang mine will move to care and maintenance.”

However, according to another source within AngloGold, the sale to Harmony, whose chairperson is Patrice Motsepe, may face a number of challenges and be halted because of political considerations.

AngloGold is chaired by Sipho Pityana, a staunch adversary of President Jacob Zuma. Motsepe, on the other hand, has two brothers-in-law who are running for the presidency – Cyril Ramaphosa and Jeff Radebe.

“The deal may be construed to be a message that Mineral Resources Minister Mosebenzi Zwane does not want it to happen because he feels it is an opportunity for small players to get into the industry,” the source said.

Another complication may be that Harmony initially wanted to buy Kopanang, as well as the Savuka section of the TauTona mine in Carletonville, as a package instead of only Kopanang. Kopanang, Savuka and TauTona are set to retrench 8 500 employees. However, it is unlikely that the Carletonville mines will be sold with Kopanang, considering the hurdles facing Kopanang alone.

AngloGold had ensured that all the bidders kept mum about the transaction through nondisclosure agreements, which City Press has also seen.

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anglogold  |  harmony gold  |  kopanang  |  mining

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