The partial or full sale of one of the company’s key operating assets “is being looked at and progressed,” Venkatakrishnan said on a conference call on Monday. That’s part of the company’s plan to reduce net debt by about $1 billion, or a third of the total, over the medium term.
“What we are not going to be doing is a fire sale of assets,” he said. “The shop is closed for bargain hunters. If we don’t get full value we won’t sell, it’s as simple as that.”
AngloGold is seeking to sell mines or share capital costs with partners in a bid to reduce its $3.1 billion of net debt, partly accumulated during the decade-long bull run in gold to 2011. The company shelved a plan to split its South African operations from its international assets in September when investors including hedge-fund billionaire John Paulson balked at the size of an accompanying $2 billion share sale.
Venkatakrishnan said he wouldn’t be naming which assets could be sold because “these are operating mines and also there are various stakeholders involved.”
AngloGold is also seeking partners for its Obuasi mine in Ghana and Colombian exploration assets.
AngloGold is gauging interest from other bullion producers and “non-conventional players” that want exposure to bullion “particularly given the uncertainty that still exists on how reliable the US recovery is,” Venkatakrishnan said.
A total of 50 deals totaling more than $2 billion were reported by private interests in the mining sector, according to analysis by law firm Berwin Leighton Paisner released this month. Gold was the most popular for deal-makers with a total of 15 transactions completed.
AngloGold made a headline loss, which excludes one-time items, of $71 million, or 17 cents a share, in the three months to December 31, compared with a profit of $44 million, or 11 cents, in the previous quarter, the Johannesburg-based company said in a statement on Monday.
AngloGold incurred $147 million of costs relating to job cuts and other restructuring at Obuasi in the fourth quarter, it said. It had to pay $44 million related to accounting losses at the country’s biggest bullion-processing plant, Rand Refinery. Other gold producers also had to foot the bill for the losses at the facility.
Gold produced climbed 2% to 1.16 million ounces in the quarter, while all-in sustaining costs declined 2% to $1,017 an ounce.
AngloGold’s net debt was $3.1 billion at the end of 2014, or 1.9 times earnings before interest, taxes, depreciation and amortization. That’s up from $2.95 billion at the end of the third quarter and about the same as a year ago.
The shares climbed for the first time in five days, adding 1.1% to R138.27 by 9:10 am in Johannesburg, extending the gain this year to 35 percent and making AngloGold the third-best performer on the 167-member FTSE/JSE Africa All Share Index in the period.