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Anglogold Ashanti to raise $307m with SA mine sales

Harmony has agreed to buy the Moab Khotsong mine for $300 million in cash.

South Africa’s Anglogold Ashanti is to sell its newest mine to Harmony Gold for $300 million and another mine for R100 million ($7.4 million) to China’s Heaven-Sent SA Sunshine Investment Company, the company said on Thursday.

Anglogold, after suffering heavy losses in its home market, said in June it would restructure its South African mines which could see 8,500 workers, around 30 percent of its workforce, laid off.

Harmony has agreed to buy the Moab Khotsong mine, South Africa’s newest gold mine, where operations started in 2006, for $300 million in cash. The sale includes related infrastructure, an underground mine called Great Noligwa and stakes in a water and a nuclear fuels company.

AngloGold Ashanti Chief Executive Srinivasan Venkatakrishnan said the sale was in line with the company’s capital allocation strategy and its aim to improve its portfolio, which includes 17 operations in nine countries.

Harmony said in a separate statement the mine would add 250,000 ounces of gold to its annual production and increase its underground resource base by 38 percent.

Anglogold will also sell its Kopanang mine, a gold plant and related infrastructure to Heaven-Sent SA Sunshine, which holds a 74% stake in gold miner Village Main Reef (VMR).

“The purchase consideration will be settled … by a payment of R100 million in cash and the transfer of certain gold-bearing rock dumps from VMR to AngloGold Ashanti,” Anglogold said in a statement.

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