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Sibanye says AngloGold, Gold Fields fit acquisition strategy

‘They fit into the category of gold producers we have publicly been saying we are looking at,’ said James Wellsted.
Image: Bloomberg

Sibanye Stillwater said Johannesburg-based gold miners AngloGold Ashanti and Gold Fields would both fit with the company’s acquisition strategy.

“They fit into the category of gold producers we have publicly been saying we are looking at,” said James Wellsted, a spokesman for Sibanye. He declined to say whether Sibanye was preparing to make an offer for either company.

Combining with AngloGold and Gold Fields would create a rival to the world’s largest producers, Newmont Corp. and Barrick Gold Corp., Sibanye Chief Executive Officer Neal Froneman told Johannesburg-based Business Day earlier on Monday. The veteran dealmaker has acquired platinum and palladium assets since Sibanye was formed by spinning off Gold Fields’ oldest South African mines in 2013. In January, Froneman said he would like to double the size of Sibanye before he retires in two to three years time.

A spokesman for Gold Fields declined to comment. AngloGold said the company is focused on its plan to unlock value from its portfolio of gold assets.

Sibanye’s market value has jumped to R216.8 billion ($14 billion) as the price of platinum-group metals surged over the past two years. AngloGold and Gold Fields are currently valued at about R136 billion and R122 billion, respectively. Both gold producers have shifted their focus away from South Africa’s deep-level mines to more profitable operations in Australia, the Americas and the rest of Africa.

Sibanye is targeting companies with annual gold output of more than 1 million ounces, Wellsted said. The company has various options for financing a deal, including offering shares or cash, or using debt, he said.

“We have been looking into this space for a long time but haven’t done deals because it got too expensive last year after Covid-19,” Wellsted said. “Obviously now the gold shares have pulled back quite a lot in the last six months, so we are starting to see value again.”

© 2021 Bloomberg

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And no mention of Harmony while the Harmony share price climbs while gold is tanking.Makes you think.

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