AngloGold Ashanti to acquire smaller rival

Egypt-focused gold miner Centamin has agreed in principle to be acquired by AngloGold Ashanti in a US$2.5 billion deal.

London-headquartered law firm Slaughter and May is acting as legal adviser on the deal to AngloGold Ashanti, who has also retained Gordon Dyal & Co as lead financial adviser and Goldman Sachs International as financial adviser. Centamin is taking legal advice from international law firm Norton Rose Fulbright (NRF), and financial advice from BofA Securities and BMO Capital.

Each Centamin share will be exchanged for 0.06983 newly issued AngloGold Ashanti shares, together with USD 0.125 in cash, constituting a near 37% premium on the GBP 1.20 (US$1.61) Centamin closing share price on 9 September.

The shareholders of Centamin, a Jersey-registered company, are set in the coming weeks to vote on the transaction, which is to be effected under Jersey law via a court-sanctioned scheme of arrangement. Following satisfaction of all customary regulatory requirements and closing conditions, the deal is forecast to complete in the fourth quarter of this year when AngloGold Ashanti and Centamin shareholders will own 83.6% and 16.4%, respectively, of the combined company, which will have a combined value of US$2.5 billion.

Founded in 1970 in Australia, Centamin counts the Sukari gold mine in Egypt’s Eastern Desert as a key asset, which has yielded over 5.9 million ounces of the precious metal since beginning production in 2009.

Denver, Colorado-headquartered global gold miner AngloGold Ashanti was formed in 2004 by the combination of AngloGold and Ashanti Goldfields. It has assets and operations across nine countries, and trades on the New York Stock Exchange, Johannesburg Stock Exchange and Ghana Stock Exchange.

AngloGold Ashanti CEO Alberto Calderon said in a statement that the deal would “add a tier 1 asset to our portfolio. The transaction is free cash-flow accretive in the first full year of production and net-asset-value accretive from day one”.

Slaughter and May used a team headed by corporate lawyers David Watkins and Harry Hecht, assisted by fellow partners William Turtle on competition, employment practitioner Phil Linnard, tax professional Gareth Miles and Matthew Tobin on finance, alongside a number of senior counsel and associates.

Emma de Ronde and Kit McCarthy led the NRF team for Centamin, with assistance from UK partners Dominic Stuttaford and Matthew Findley on tax, Catrina Smith on employment, Ian Giles on competition matters and corporate lawyer Tom Vita, together with a wider team of associates. Todd Schroeder in Dallas provided US tax advice, while Australia corporate matters were led by David Jewkes in Perth and Melbourne counterpart Jeremy Wickens.

AngloGold Ashanti sold its sole remaining South African asset to Harmony Gold for USD 300 million in March 2020, citing its aim to focus on other jurisdictions in Africa and beyond.

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