AngloGold shares up on takeover nod


AngloGold, headed by Bobby Godsell, has won regulatory approval for its takeover bid for Normandy Mining

By CNN's Geoff Hiscock
Asia business editor

SYDNEY, Australia -- Shares in the world's biggest gold producer, AngloGold, jumped Wednesday after it said it had won regulatory approval for a takeover of Australian gold miner Normandy Mining.

But success is far from assured. Normandy's board has already rejected the AngloGold bid in favor of a competing offer from U.S.-based Newmont Mining Corp.

In a statement to the Australian Stock Exchange Wednesday morning, AngloGold said Australia's Foreign Investment Review Board had approved its proposed acqusition of Normandy.

AngloGold's offer for Normandy is worth about $1.7 billion (A$3.2 billion).

Newmont trumped that when it said on November 14 it wanted to buy Normandy and Toronto-based Franco Nevada Mining Corp for a total of $4.41 billion in stock and cash. About $1.98 billion of that was for Normandy.

Franco Nevada is the largest shareholder in Normandy, with a 19.9 percent stake.

Continues to woo shareholders

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Despite the Normandy board favoring Newmont's offer, AngloGold has continued to woo its target's shareholders.

It claims the board's response was "potentially misleading" and that the volatility in Newmont's share price meant the Newmont offer could be less than AngloGold's when settlement took place.

In its statement Wednesday, AngloGold said its offer currently values Normandy at A$1.46 a share, based on the closing price of AngloGold shares on the New York Stock Exchange on Tuesday.

It said this compared with a maximum value of A$1.47 (A$1.42 plus an extra 5 cents if acceptances reach 90 percent) for the Newmont offer, based on its Tuesday closing price on the NYSE.

AngloGold also said it has lodged an application with the Australian Takeover Panel challenging aspects of the Newmont bid and the related arrangements with Franco Nevada.

Newmont is basing its campaign on what it says is the premium that investors attach to its scrip.

Australia's biggest gold miner

Normandy, based in Adelaide, is Australia's biggest gold miner, producing more than 2 million ounces a year.

AngloGold, based in South Africa and headed by Bobby Godsell, is the world's biggest gold producer. It is owned 53.4 percent by the giant resources group AngloAmerican.

Denver-based Newmont is the world's No.2 producer, with extensive operations in the U.S., Canada and Mexico.

Normandy shares closed 1 cent higher at A$1.52 on the ASX Wednesday, while AngloGold was up 2.27 percent or $1.50 to A$67.50.