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10.08.2004 General News

Randgold "Endorse" Atta Mills

By businessday.co.za
Randgold

Kebble wines, dines Ghana's poll hopeful CAPE TOWN Randgold Resources' Brett Kebble has nailed his colours to the mast of Ghana's opposition presidential candidate Prof John Evans Atta Mills.

The endorsement at a sumptuous dinner at a five-star Cape Town hotel last week comes in the wake of Randgold's failed bid for the rich Ghanaian gold mine, Ashanti Goldfields. Randgold was outmanoeuvred in fiercely fought bidding by AngloGold, which merged with Ashanti.

While Randgold's offer was 300 million more than AngloGold's 1,4bn, shareholders opted for the latter's greater expertise in deep-level mining and larger capital reserves.

It was not clear from the speeches made by Kebble and Atta Mills at the function whether Kebble is bankrolling the latter's election campaign.

However, South African Institute for International Affairs parliamentary research fellow Tim Hughes said the opposition National Democratic Congress, which Atta Mills leads, needed cash. Hughes suggested Atta Mills had come to SA in search of funds and some kind of political endorsement from the African National Congress, with which his party has a historic affiliation.

Ghana is holding its general and presidential elections in December with the present presidential incumbent, John Kufuor of the New Patriotic Party, seeking re-election after a four-year term. Kufuor defeated Atta Mills in the 2000 presidential election in the second round after an indecisive first round.

Should Atta Mills defeat Kufuor, the political climate for AngloGold's activities in Ghana would change significantly though the terms and conditions of its merger with Ashanti would not be altered.

Conversely, success for Atta Mills would create a favourable climate for Randgold to seek other mining opportunities in the country. AngloGold Ashanti, Newmont and Gold Fields are the only mining companies operating in Ghana.

The Ghanaian government has a 3% stake in the merged AngloGold Ashanti, derived from its 16,9% interest in Ashanti.

Both Atta Mills and Kebble stressed the importance of the state retaining a stake in Ghanaian enterprises sold to foreign investors.

Atta Mills was highly critical of what he believed was the handing over by the government of its "golden share" in Ashanti to the merged operation, while Kebble emphasised the importance of partnership arrangements. The golden share gave the government a veto over the buying and selling of the company's Ghanaian operations.

Atta Mills described the loss of the "golden share" as a betrayal of the Ghanaian people who would eventually call the government to account for it. However, in terms of the final agreement with AngloGold, which was approved by Ghana's parliament, the government would continue to hold a veto.

AngloGold Ashanti spokesman Alan Fine said the company believed the transaction was a fair one.

Describing himself as a social democrat, Atta Mills expressed opposition to the outright privatisation of state-owned assets, arguing the state had to retain ownership of utilities to assist the poor.

Neither South African Institute for International Affairs national director Greg Mills nor Hughes gave Atta Mills much chance of winning the poll, saying he had been tarnished by the legacy of his party's former leader and former Ghanaian president Jerry Rawlings.

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