Commission probes Lonrho's Anglo link

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The Independent Online
The European Commission is vetting Lonrho's controversial link- up with Anglo-American, in an enquiry which may lead to the South African mining giant being forced to sell its 26 per cent stake.

The Commission concerns centre on reduced competition in the supply of platinum, if Anglo is deemed to have a significant influence on Lonrho's mining operations.

Anglo and Lonrho, together with South Africa's Gencor, are already the Western world's dominant suppliers of the precious metal, which is a key catalyst in the world's motor industry.

In April, the Commission vetoed a pounds 400m merger of Lonrho's platinum mines with Gencor's Impala, which would have made the combined operation joint world leader with Anglo's Rustenburg with a 38 per cent market share.

"We are examining the current situation with interest," said one senior official at the Commission's powerful Merger Task Force, part of the DGIV Competition Directorate.

"But no announcement will be made for the time being. We are still in the process of trying to find out what's going on."

The news comes as Lonrho's founder Tiny Rowland this weekend launched another broadside at outgoing German chief executive Dieter Bock over his sell-out to Anglo and continuing break-up of the group.

In press adverts and an eight page circular to shareholders posted yesterday, Mr Rowland condemned the dramatic slide in Lonrho's shares, which have fallen from a high of 217p in February to close at a year's low of 139p on Friday.

"It's time for investors in Lonrho to make clear to their directors that the chief executive's self serving qualities have destroyed shareholder value for all of us," he says.

Anglo lifted its holding on Thursday with the completion of the pounds 257m purchase of Mr Bock's 18.3 per cent stake at 180p per share under a put option exercised 10 days ago. The German property developer also stepped down to become non-executive deputy chairman before taking a major stake in the planned demerger of Lonrho's non-mining African operations.

In the latest break-up move, Lonrho also announced the pounds 327m sale of its Metropole hotels chain to rival Stakis and is now understood to have agreed similar terms with Saudi billionaire, prince al-Waleed bin Talal for the sale of its US Princess chain shortly.

In his circular, Mr Rowland attacked recent interviews given by Mr Bock in the German press that he intended to negotiate with Anglo to take control of Lonrho Africa.

This weekend a spokesman for Mr Bock denied any side deals had been done and said his Lonrho Africa ambitions extended to less than a 50 per cent stake.

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