‘AngloGold to replace Goldman, UBS’

Published Oct 17, 2014

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London - AngloGold Ashanti is moving to replace advisers Goldman Sachs and UBS after an investor rebellion last month forced it to scrap a $2.1 billion (R23 billion) share sale, according to people familiar with the situation.

The world’s third-biggest gold producer is talking to potential new advisers after having to abandon the sale and asset split five days after it was announced, the people said, asking not to be identified because the talks are private.

UBS has been AngloGold’s sponsor on the Johannesburg Stock Exchange since its separation from Anglo American in 1998.

Investors including hedge-fund billionaire John Paulson balked at AngloGold’s plan to split its international operations from its South African mines last month, saying an accompanying share sale was too dilutive to their holdings.

The company’s focus has shifted to getting cash from existing operations while studying asset sales, chief executive Srinivasan Venkatakrishnan said after scrapping the sale.

Goldman Sachs was an underwriter and bookrunner with UBS on AngloGold’s $1.6 billion share sale in 2008 and helped sell stakes in the producer held by Anglo American in 2006 and 2007, according to company statements.

Goldman is also part of the miner’s banking syndicate.

Paulson, whose Paulson & Co. holds 6.6 percent of the company and had campaigned for the asset split, objected to the size of the share sale and planned to vote against the proposal.

“The concept is good, but the execution, the way they’re doing it with this massive dilutive equity offering, it’s value-destructive,” he said last month.

AngloGold, which has a market value of about $4.2 billion, said it needed to raise the funds to lower debt, a large portion of which is guaranteed by its South African operations.

The plan had regulatory approval from the South African Reserve Bank.

Spokesmen for AngloGold and UBS declined to comment and a spokeswoman for Goldman Sachs didn’t immediately return a phone call seeking comment.

AngloGold declined 0.8 percent to close 116.10 rand in Johannesburg yesterday. - Bloomberg News

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