AngloGold Ashanti announced on Monday that it had sold its stake in the Brazilian gold mine Mineração Serra Grande (MSG) to Aura Minerals, as the group continues to capitalise on record gold prices by disposing of noncore assets.
The company will receive $76m in cash for the asset, with deferred consideration payments that will be paid quarterly in cash, according to a statement on Monday.
The sale forms part of AngloGold’s strategic effort to prioritise its core assets in the US, allowing the company to refocus on its key operations and maintain disciplined capital allocation.
Part of this process is getting rid of smaller, high-cost mines. While MSG’s recent focus had been on stabilising its operations, it remains one of AngloGold’s higher cost and smallest operations by production, said the group.
The announcement comes only a month after the miner agreed to divest its stakes in two gold projects in Ivory Coast to Australian-listed Resolute Mining in a deal valued at up to $185m (R3.32bn).
It also comes less than nine months after AngloGold’s acquisition of Centamin, Egypt’s largest gold mine, for $2.48bn.
Over the past year, record gold prices have freed up significant capital for SA’s largest gold mining companies, putting bullion at the heart of deal-making activity in the mining sector.
Gold has gained more than a quarter this year thanks to safe-haven demand, with investors flocking to precious metals as a hedge against US policy uncertainty and heightened geopolitical tension.
With gold prices projected to remain at record highs, the favourable outlook leaves gold miners much room for expansion and book balancing, putting more acquisitive growth on the horizon.
“This sale ensures we further sharpen our focus on capital allocation, operating efficiencies and the optimisation of our portfolio,” said AngloGold Ashanti CEO Alberto Calderon.
“We’ve also worked hard to ensure that MSG and its excellent team joins an established company which will continue to be responsible stewards of this asset for the benefit of all stakeholders.”
MSG is located in central Brazil and comprises three mechanised underground mines and an open pit. Last year, the operation produced 80,000 ounces of gold, down from 86,000 ounces in 2023.
The sale is expected to close in the third quarter of this year, subject to regulatory approval. It excludes MSG subsidiaries whose assets do not form part of MSG’s mining operations, which will remain in the AngloGold portfolio and will be transferred from MSG before closing the sale.
At 3.15pm, shares in AngloGold were up more than 6% as investors welcomed the deal.
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