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Wednesday, September 15, 2010

AngloGold (NYSE:AU) Closing Hedge Book in Early 2011

AngloGold Ashanti (NYSE:AU) is poised to shut down its hedge book in the early part of 2011, joining other gold miners whose confidence in the support underlying gold prices will continue on for some time into the future.

The giant gold miner will offer convertible notes and common shares as the choices to raise the capital to eliminate their hedging position.

The offering of mandatory convertible notes and equities will be launched at the same time.

Approximately 16 million new ordinary shares will be issued by AngloGold, along with mandatory convertible subordinated bonds, which will be due 2013.

About $1.4 billion will be raised from the sales, which will be used not only to close Anglo's hedge book, but also to fund projects and maintain their balance sheet.

Major competitor Barrick Gold (NYSE:ABX) closed their hedge book about a year ago.

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