South Africa’s Top Gold Miner Raises Cash for Acquisition
South Africa’s Top Gold Miner Raises $200 Million to Fund Deal
Harmony Gold Mining Co. raised $200 million through a share sale after investors backed its plan to purchase AngloGold Ashanti Ltd.’s last South African operations.
Harmony decided to sell shares after its mines were shuttered during a coronavirus lockdown, impacting its original plan to finance the $300 million deal with cash and deferred payments. AngloGold’s Mponeng mine and Mine Waste Solutions will help Harmony replenish its South African reserves and cement its position as the nation’s top gold producer.
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“This successful placement is a validation of our investors’ support for Harmony’s stated strategy to safely grow quality ounces and increase margins,” Chief Executive Officer Peter Steenkamp said in a statement on Thursday.
Harmony sold more than 60 million shares at 57.50 rand ($3.30) apiece, 5.4% below Wednesday’s closing price. The miner’s shares were trading up 2.3% Thursday at 60.90 rand at 11:10 a.m local time.
The deal would be concluded once the South African government approves transfer of mineral rights to Harmony, Marian Van Der Walt, a spokeswoman, said. Both companies initially said the sale would be concluded by the end of June.
“We are working on getting the approvals, which we believe is imminent,” Van Der Walt said.
The sale of Mponeng and the surface assets also marks the exit from South Africa of AngloGold, the world’s third-largest gold miner, which emerged from a mining empire created by Ernest Oppenheimer more than a century ago.
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