AngloGold Ashanti, a US-listed global miner, is buying Centamin, a smaller rival focused on Egypt, in a $2.5bn stock and cash deal, the companies announced Tuesday. The acquisition marks AngloGold Ashanti’s latest move to expand its operations in Africa.
Shares in Centamin jumped about 24% to 148.10 pence in early trade, reaching their highest level since October 2020. New York-listed AngloGold’s shares were down 6% in premarket trading.
Under the terms of the deal, Centamin shareholders will receive 0.06983 new AngloGold shares for each Centamin share they hold, plus $0.125 in cash. The offer, representing a 36.7% premium over Centamin’s closing price of 120 pence on Monday, values the company at $2.14 per share.
Following the completion of the Centamin deal, it is expected that AngloGold shareholders will own about 83.6% and Centamin shareholders about 16.4% of AngloGold Ashanti’s enlarged issued share capital.
AngloGold Ashanti expects the deal to boost its free cash flow per share within the first full year after the transaction is completed, according to the company’s statement.
AngloGold Ashanti Chair Jochen Tilk described the deal as “highly compelling” and said it presents “enormous geological potential” that the company is well-positioned to develop.
Centamin’s principal asset is the Sukari gold mine, which is Egypt’s largest gold mine and one of the world’s largest producing mines. In January, Centamin announced plans to increase its annual production from 450,000 ounces in 2023 to between 470,000 and 500,000 ounces in 2024. The company has raised its estimates of gold reserves in Egypt’s largest producing mine by 10 percent from 5.3 million to 5.8 million ounces.
