AngloGold Ups Bid for Ashanti
October 16, 03
The board of the Ghanaian gold miner Ashanti Goldfields recommended its shareholders to accept an improved bid from AngloGold, bringing the proposed $1.42 billion acquisition closer to being sealed.
On Tuesday AngloGold revealed it would up the Ashanti bid from 26 shares per 100 Ashanti shares to 29 shares.
But perhaps of no less importance, AngloGold secured a promise from Ashanti's biggest shareholder Lonmin, which holds a 27.6 percent stake in the company, to not consider the alternative bid by Randgold Resources unless it includes a cash component.
According to a report by Dow Jones, analysts feel Lonmin prefers AngloGold's bid because it could eventually unload AngloGold shares with less disruption to the market than Randgold shares.
Randgold’s offer is worth for $1.7 billion, but is an all-share bid. The company promises the fight was not over and it was currently considering its options.
To seal the deal the Ghanaian government and SEC must give their respective approval.