By far South Africa's biggest company, the labyrinthine gold-to-brewing conglomerate has been inextricably entwined with the country's modern history, with corporate roots reaching back beyond its own foundation in 1917 to the great diamond and gold rushes of the 19th century. Its decision to move to the cheaper and more stable capital markets of London will force another round of self-examination on a country struggling to come to terms with a battered currency and the realities of its place in the post-apartheid world.
Although yesterday's announcement came as part of a long and dissipated merger between "Anglo" and Luxembourg-based Minorco, the company that Anglo used as its overseas arm during the years of anti-apartheid sanctions, a move to London caught even the analysts by surprise.
In an interview with the Johannesburg Star conducted before the announcement, Societe Generale's Peter Davey remarked: "Anglo almost is South Africa. It is not in a position to leap into London. That would be a thumbs-down to the South African economy."
At a press conference in Johannesburg yesterday, the Anglo American chairman, J Ogilvie Thompson, said that the merger will create a company with an estimated asset value of $10.5bn. The company would easily fit into the top 100 companies on the London Stock Exchange's FTSE Index and be able to compete internationally as one of the world's largest mining houses. "What we are marking today is the end of the financial structures that have been imposed upon us by apartheid," he said.
The conference was also addressed by the De Beers chairman, Nicky Oppenheimer, whose grandfather founded Anglo American with mainly British and US capital.
Although the merger is being portrayed as an effort to simplify Anglo American's complex web of cross-holdings, De Beers and Anglo American will continue to control roughly 30 per cent of each other's stock after the merger takes place.
Ogilvie Thompson, Oppenheimer also sought to play down the implications of Anglo American's corporate departure from its birthplace, saying that roughly two-thirds of the newly merged stock will be in South African hands when the company is launched in March. Local analysts scrambled to praise the principles behind the move which - by shifting the company's accounts into hard currency - will allow it to raise funds at less than half the cost of doing so in South Africa.
Bobby Craig, an analyst at Merrill Lynch, said he did not feel the move should be sensationalised as a flight overseas. "You can't pick up a gold mine and run away with it. The assets are still going to be here."
Ross Auchterlonie, a British-born mining analyst with SG Frankel Pollak Securities, said the deal made perfect sense for Anglo American but also reflected the "harsh realities" of South African economic life.
The first public criticism of the move came yesterday from the president of South Africa's National Union of Mineworkers, James Motlasi, who said the government had approved the deal despite his opposition.
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