South Africa: Jonah Too Big for This Whale?

28 January 2003

The period granted to AngloGold [NYSE:AU] by Ashanti Goldfields [NYSE:ASL] for a due diligence on the latter's assets expires this week raising questions as to the benefits and obstacles of the South Africans plumping for this Pan-African gold deal. Ashanti produces 1.6 million ounces a year, has a pipeline of growth projects, and a hedge book that is becoming increasingly palatable. But a stumbling block is there's no boardroom in the world that could contain and meld the flaring personalities of Ashanti Goldfields' Sam Jonah and AngloGold's Bobby Godsell.

Nonetheless, there's huge political cache in a merger between AngloGold and Ashanti Goldfields. Ashanti's Sam Jonah sits on South African president Thabo Mbeki's advisory council and no doubt recognises that a merger would strongly affirm the principles of NEPAD (New Partnership for African Development).

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