Mining giant sells $1B stake

Press, 16 August 1989, Page 40

Mining giant sells $1B stake

NZPA-AFP London The British mining group, Consolidated Gold Fields, is selling a 30% stake worth £368 million (SNZBBO.BSM) in its South African subsidiary, Gold Fields of South Africa. Cons Gold was taken over by the Hanson conglomerate of Britain last week after a £3.58 ($NZ9.428) takeover bid, the largest-ever to succeed in Britain. Cons Gold said it would keep an 8% stake in GFSA after selling the 30% stake to the Rembrandt group of South Africa and the Asteroid company, also of South Africa, a joint subsidiary of GFSA and Driefontein Consolidated.

Together, the two buyers will control about 40% of GFSA’s ordinary share capital, as Cons Gold had already sold Rembrandt a 10% stake in GFSA two years ago.

The chairman of Consolidated Gold Fields, Mr Rudolf Agnew, said: "The directors of both Hanson and Gold Fields are satisfied that this deal is in the best interests of the shareholders of both companies.

“The transaction ensures the long-term future of GFSA as a major independent mining house,” he said, adding that the sale, which values GFSA at £l5 a share, was going through at 23% “over the current market price.”

The move came as no surprise in financial circles in London, which had expected Cons Gold to be partially dismantled after Hanson won control. Cons Gold’s share price rose a penny to 1483 this morning, while Hanson stock was unchanged at 240.5 p.

Hanson is known for taking over companies to break them up, City analysts expect Hanson to sell off ConsGold’s mining interests throughout the world, possibly leaving only ARC, GFSA’s aggregates subsidiary.

The reduction of ConsGold’s stake to 8% in GSFA marks a new stage in the gradual withdrawal of British capital from South Africa, observers said.