Anglogold Announces Sale Of Free State Assets To Arm And Harmony

Anglogold Limited
Incorporated in the Republic of South Africa)
(Registration number 1944/017354/06)
("AngloGold" or "the company")
JSE Share Code: ANG      ISIN Code: ZAE 000014601
NEWS RELEASE
CORPORATE AFFAIRS DEPARTMENT
1st FLOOR, 11 DIAGONAL STREET
JOHANNESBURG 2001
TELEPHONE: (+27 11) 637-6379
FAX: (+27 11) 637 6399/6400
SKB/CAD/AGO269.01

ANGLOGOLD ANNOUNCES SALE OF FREE STATE ASSETS TO ARM AND HARMONY

AngloGold announced today that it would be selling its assets in the Free
State province of South Africa to African Rainbow Minerals (ARM) and Harmony
Gold Mining (Harmony) for R2.2 billion.  This is subject to the transaction
being recognised by the South African tax authorities as a rationalisation
scheme, in which case no recoupment tax will be payable by AngloGold on the
proceeds of the sale.

ARM and Harmony will hold equal joint venture interests in the assets when
the transaction takes effect on 1 January 2002.
The Free State assets comprise:

- four mines - Bambanani, Joel, Matjhabeng and Tshepong;

- all surface infrastructure and equipment including metallurgical plants,
commercial and residential properties, and the Ernest Oppenheimer Hospital
in Welkom;

- all shares in Jeannette Gold Mines owned either directly or indirectly;
and

- all minerals rights in the Welkom and southern Free State goldfields.
The contracts of employment of all employees on these operations will be
transferred to the new owners, unless another agreement has been reached
between the parties.

The only assets that AngloGold will retain in the Free State are

its Technical Development Services Division and those that form part of its
wholly-owned subsidiary, ISS International.  AngloGold will also retain all
of its mineral rights north of the Free State goldfields.

AngloGold Chairman and CEO Bobby Godsell commented: "It is our strategic
objective to develop, acquire and operate long-life, low-cost , world-class
gold mining assets and to close or to sell mines approaching the end of
their profitable lives to operators who are better suited to extracting
value from such assets.  With the exception of Tshepong, the Free State
mines fall into the latter category."

Putting the sale into perspective, he said that for the nine-month period
ended 30 September 2001, the Free State operations had produced 17.3% of
AngloGold's worldwide production, but only 8.3% of its earnings before
interest, tax, depreciation and amortisation (EBITDA).  The total cash costs
of the Free State mines over this period were US$229 per ounce, compared
with US$184 per ounce for all of AngloGold's operations.

Taken over the first nine months of 2001, the sale would have the effect of
lowering AngloGold's total cash costs for the company's remaining assets
worldwide by 5% - from US$184 per ounce to US$175.

Mr Godsell pointed out that AngloGold had previously announced its intention
to close Joel and Matjhabeng.

Bambanani mine was a mature asset with a medium-term remaining life.

Tsephong, however, was a long-life, low-cost, world-class mine but it was
inextricably linked to the Free State assets and could not be excluded from
this transaction.

Turning to the ARM and Harmony joint venture, he said it met two important
criteria which AngloGold had set regarding the transaction: one was to
encourage the consolidation of ownership and management in the region; the
other was to promote black economic empowerment.

"We have long advocated further consolidation in the South

African gold mining industry in the interests of ensuring optimal extraction
of value from existing operations to the benefit of all.  ARM and Harmony
already own and operate assets in the Free State.  The acquisition of
AngloGold's assets will result in ARM and Harmony becoming the principal
operators in the Free State goldfields.

"The transaction will allow for meaningful participation of previously
disadvantaged groupings in both the ownership and management of a
substantial gold mining operation."

The ARM/Harmony joint venture will pay the R2.2 billion for the Free State
assets in two cash instalments: R1.8 billion on completion of the

transaction and R400 million in three years' time.  Management and economic
benefits will pass to the JV from 1 January 2002 and interest will be
payable on the R1.8 billion from that date until the transaction is
complete.
ends
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