AngloGold Ashanti (NYSE:AU,JSE:ANG) has introduced a US$2.5 billion acquisition of Centamin (LSE:CEY,TSX:CEE), a mining firm working Sukari — one of many world’s greatest gold mines and Egypt’s largest.
AngloGold CEO Alberto Calderon, who took over in 2021, emphasised that the acquisition is a part of a broader technique of specializing in “Tier 1” property, that are high-value, low-cost tasks with lengthy operational life spans.
“The Transaction is free money move accretive within the first full yr of manufacturing and NAV accretive from day one; it should additionally supply further upsides as we leverage our company infrastructure and our core competencies in exploration, operations and asset optimisation,” he commented in a Tuesday (September 10) assertion.
Calderon additionally informed Reuters that the transfer comes after a serious reorganization at AngloGold.
Centamin shareholders will obtain 0.06983 new AngloGold shares and US$0.125 in money for every Centamin share held. The supply represents a 36.7 % premium to Centamin’s closing share value the day earlier than the information.
Following the merger, Centamin shareholders will personal roughly 16.4 % of the mixed firm, with the rest held by AngloGold shareholders. The addition of Sukari’s output is about to spice up AngloGold’s manufacturing by 450,000 ounces yearly, taking the agency’s yearly gold output to greater than 3 million ounces.
That may make it the fourth largest gold producer globally, solely trailing Newmont (TSX:NGT,NYSE:NEM), Barrick Gold (TSX:ABX,NYSE:GOLD) and Agnico Eagle Mines (TSX:AEM,NYSE:AEM).
The acquisition additionally comes throughout a interval of heightened M&A exercise within the gold sector.
A number of key offers have taken place just lately, together with Newmont’s US$16.8 billion acquisition of Newcrest Mining in 2023 and Gold Fields’ (NYSE:GFI,JSE:GFI) deliberate US$1.59 billion buy of Osisko Mining (TSX:OSK,OTC Pink:OBNNF).
At the moment AngloGold operates in 9 nations, together with Tanzania, Ghana, Australia and the US. Sukari will add Egypt to this checklist, offering the corporate with entry to one of many largest producing gold mines on the earth.
Reuters notes that AngloGold could look to divest sure properties post-acquisition, together with Centamin’s Doropo venture in Côte d’Ivoire and two of AngloGold’s Brazilian operations. That may permit the corporate to refocus its portfolio round its most dear property whereas nonetheless benefiting from the expanded manufacturing capabilities the Centamin deal gives.
Centamin’s departure from the London Inventory Trade falls inside a continued development of mining corporations consolidating and shifting their listings to new areas. After Centamin is acquired, Endeavour Mining (LSE:EDV,TSX:EDV,OTCQX:EDVMF) would be the solely main valuable metals mining firm current on the trade.
Shares of AngloGold declined by roughly 8 % instantly following the announcement, whereas Centamin’s share value surged by over 20 % in London as buyers reacted to the information.
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Securities Disclosure: I, Giann Liguid, maintain no direct funding curiosity in any firm talked about on this article.
