UBS and Goldman Sachs left red-faced by AngloGold Ashanti $2.1bn float flop
Proposals for a new London-listed mining spin-off worth £3bn hit the dust yesterday, as shareholders at one of the world’s top gold miners revolted over a $2.1bn (£1.3bn) rights issue key to the massive restructuring.
South Africa-based AngloGold Ashanti was forced into a U-turn just five days after it announced it would spin off its international assets into a new company, leading to huge embarrassment for global banks advising on the deal.
With such a dramatic reversal in less than a week, questions were raised over why the market had not been sufficiently sounded out before launching the demerger and rights issue proposals.
Market reaction last week was instantly negative, as AngloGold shares fell nearly 15 per cent during trading last Wednesday after the restructuring plans were revealed.
AngloGold yesterday said it had been in talks since last week with two-thirds of investors, and while there was “broad support for the strategic logic of the restructuring”, shareholders held firm in their opposition to the scale of share dilution.
Source: cityam- UBS and Goldman Sachs left red-faced by AngloGold Ashanti $2.1bn float flop
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