Shareholders OK Lonrho deals

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The Independent Online
LONRHO took another step towards turning itself into a focused mining company yesterday when shareholders approved plans for the pounds 177m purchase of Anglo-American's 21 per cent stake in the business while approving the pounds 167m purchase of the Tavistock coal mine from JCI.

At an emergency meeting in central London yesterday, attended by only 100 shareholders, the resolutions were passed by 79.3 per cent of the votes cast.

Lonrho's resolutions did not go through unchallenged. Tiny Rowland, the Lonrho founder and former chairman who has been placing adverts in newspapers voicing his criticism of the board's plans, did not attend but his solicitor appeared as his representative.

Matthew Knight raised some of Mr Rowland's points, which included questions over the board's optimism on the outlook for the coal price and the increase in Lonrho's debts to uncomfortable levels. He also questioned why Anglo- American had sold 40 million Lonrho shares to SBC Warburg at a discount to the market price.

One private shareholder asked whether directors' pay would now be reduced as Lonrho would be a much smaller business.

Yesterday's agreement, combined with the group's plans to demerge its non-mining operations into a new company, Lonrho Africa, was a milestone on Lonrho's road to casting off its sprawling colonial conglomerate heritage and becoming a mining group with coal, platinum and gold interests in Africa.

Under the terms of the deal, Anglo American is swapping a 21 per cent stake in Lonrho which it has held since 1968, for JCI's share in the HJ Joel gold mine and JCI's stake in platinum producer Amplats. JCI, through a transaction with Investec Bank, is then selling the Lonrho shares on to Lonrho for around pounds 176.7m.