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ANG - Anglogold Ashanti Agrees To Acquire 100% Of Sao Bento
AngloGold Ashanti Limited
Incorporated in the Republic of South Africa
Registration Number: 1944/017354/06)
ISIN Number: ZAE000043485
JSE Share Code: ANG
("AngloGold Ashanti/Company")
ANGLOGOLD ASHANTI AGREES TO ACQUIRE 100% OF SAO BENTO
AngloGold Ashanti Limited ("AngloGold Ashanti") is pleased to announce that
it has entered into a letter agreement with Eldorado Gold Corporation
("Eldorado") to acquire 100% of Eldorado`s wholly owned subsidiary, Sao Bento
Gold Limited ("SBG"), which company in turn wholly owns Sao Bento Minera'ao S.A.
("SBMSA") for a consideration of US$70 million to be settled by the issue of
AngloGold Ashanti shares to Eldorado ("the Transaction").
SBMSA holds the Sao Bento Mine ("Sao Bento"), a Brazilian gold operation
located in the immediate vicinity of AngloGold Ashanti`s proposed Corrego do
Sitio Mine ("Corrego do S'tio"). Corrego do Sitio is part of AngloGold Ashanti
Mineracao Ltda and is located in the municipality of Santa Barbara, Iron
Quadrangle region of Minas Gerais State, Brazil. Sao Bento started its
operations in 1986 and operated until January 2007, at which time Sao Bento`s
process plant and facilities were placed on care and maintenance.
At Corrego do Sitio, AngloGold Ashanti is currently investigating the
viability of exploiting the potential sulphide ore resources of the Corrego do
S'tio underground ore bodies. Underground development to further access and
explore these ore bodies, as well as trial mining, is in progress. Prior to the
acquisition of Sao Bento, it was expected that Corrego do Sitio would produce
approximately 100,000 ounces of gold annually over 14 years with production
scheduled to commence in mid-2011. The acquisition of Sao Bento provides
AngloGold Ashanti with the potential to double the scale, and considerably
enhance the potential, of the Corrego do Sitio project. Initially it is
envisaged that ore from Corrego do Sitio will be treated in the Sao Bento
process plant using a refurbished and modified circuit of milling and flotation
with the concentrate being transported to AngloGold Ashanti Mineracao Ltda`s
Quieroz plant.
Furthermore, following a planned exploration program at Sao Bento it is
expected that an expansion of the Sao Bento process plant will be implemented
(currently anticipated to be implemented in 2013) that will allow for the full
treatment of ore (and production of gold) from ore bodies both at Corrego do
Sitio and Sao Bento at the Sao Bento process plant, at which point gold
production from the expanded Corrego do Sitio project could exceed 200,000
ounces per annum. In addition, the acquisition of Sao Bento further enhances
AngloGold Ashanti`s dominant position as a gold producer within Brazil`s Iron
Quadrangle with the possibility of being a further consolidator within this
region.
The Transaction is subject to the execution and delivery of all definitive
agreements necessary to implement the Transaction and the receipt of all
necessary regulatory, ministerial and other government approvals in South Africa
and Brazil including the approval of the South African Reserve Bank and the SDE-
CADE antitrust approval in Brazil. It is anticipated that these approvals will
be obtained and that the Transaction will close early in the fourth quarter of
this year. Prior to the implementation of Transaction and at Eldorado`s cost,
the Villa Nova Iron Ore Project located in the Amapa District of Brazil, certain
mining equipment and certain key employees of SBMSA, will be transferred out of
SBMSA to Eldorado. All other assets of SBMSA will remain. In addition, prior to
the implementation of the Transaction Eldorado will also settle all shareholder
and third party loans outstanding to SBG.
Commenting on the Transaction, Ron Largent, Executive Vice President
America`s commented "The Sao Bento assets have the potential to double the
scale, and therefore significantly enhance the potential, of the Corrego do
S'tio project. As such AngloGold Ashanti`s annual gold production from Brazil
could increase by some 200,000 ounces. The acquisition of Sao Bento forms an
important contributor to the growth of our Brazilian operations and further
enhances the position of AngloGold Ashanti in Brazil`s Iron Quadrangle."
This communication shall not constitute an offer to sell or the solicitation
of an offer to buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
jurisdiction. This communication is not an offer of securities for sale into the
United States. No offering of securities shall be made in the United States
except pursuant to registration under the US Securities Act of 1933, as amended,
or an exemption therefrom.
Certain statements made during this communication including, without
limitation, those concerning AngloGold Ashanti`s strategy to reduce its gold
hedging position including the extent and effect of the hedge reduction, the
economic outlook for the gold mining industry, expectations regarding gold
prices, production, cash costs and other operating results, growth prospects and
the outlook for AngloGold Ashanti`s operations including the completion and
commencement of commercial operations of certain of AngloGold Ashanti`s
exploration and production projects, and its liquidity and capital resources and
expenditure, may contain certain forward looking statements regarding AngloGold
Ashanti`s operations, economic performance and financial condition. Although
AngloGold Ashanti believes that the expectations reflected in such forward
looking statements are reasonable, no assurance can be given that such
statements will prove to have been correct, Accordingly, results could differ
materially from those set out in the forward looking statements as a result of,
among other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment, and
other governmental actions, fluctuations in gold prices and exchange rates, and
business and operational risk management. For a discussion of such factors,
refer to AngloGold Ashanti`s annual report for the year ended 31 December 2007,
which was distributed to stakeholders on 31 March 2008, AngloGold Ashanti
undertakes no obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after today`s date
or to reflect the occurrence of unanticipated events.
ENDS
Johannesburg
31 July 2008
JSE SPONSOR: UBS
This communication shall not constitute an offer to sell or the solicitation
of an offer to buy any securities, nor shall there be any sale of securities in
any jurisdiction in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
jurisdiction. This communication is not an offer of securities for sale into the
United States. No offering of securities shall be made in the United States
except pursuant to registration under the US Securities Act of 1933, as amended,
or an exemption therefrom.
Certain statements made during this communication including, without
limitation, those concerning AngloGold Ashanti`s strategy to reduce its gold
hedging position including the extent and effect of the hedge reduction, the
economic outlook for the gold mining industry, expectations regarding gold
prices, production, cash costs and other operating results, growth prospects and
the outlook for AngloGold Ashanti`s operations including the completion and
commencement of commercial operations of certain of AngloGold Ashanti`s
exploration and production projects, and its liquidity and capital resources and
expenditure, may contain certain forward looking statements regarding AngloGold
Ashanti`s operations, economic performance and financial condition. Although
AngloGold Ashanti believes that the expectations reflected in such forward
looking statements are reasonable, no assurance can be given that such
statements will prove to have been correct, Accordingly, results could differ
materially from those set out in the forward looking statements as a result of,
among other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment, and
other governmental actions, fluctuations in gold prices and exchange rates, and
business and operational risk management. For a discussion of such factors,
refer to AngloGold Ashanti`s annual report for the year ended 31 December 2007,
which was distributed to stakeholders on 31 March 2008, AngloGold Ashanti
undertakes no obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after today`s date
or to reflect the occurrence of unanticipated events.
Queries
South Africa:
Himesh Persotam (Investor Relations) Tel: +27 (0) 11 637-6647
Mobile: +27 (0) 82 339 3890 E-mail: hpersotam@AngloGoldAshanti.com
Alan Fine (Media) Tel: +27 (0) 11 637-6383 Mobile: +27 (0) 83 250 0757
E-mail: afine@AngloGoldAshanti.com
Joanne Jones (Media) Tel: +27 (0) 11 637- 6813 Mobile : +27 (0)82 896 0306
E-mail: jjones@AngloGoldAshanti.com
Date: 31/07/2008 08:08:43 Supplied by www.sharenet.co.za
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