Anglo American plc has undertaken to subscribe in full to its entitlement to the $1 billion rights issue announced today by its 45% owned associate company, De Beers. Anglo American will invest $450 million in equity as part of a commitment by each of the three shareholders in De Beers to pro rata equity contributions.
During 2009, De Beers implemented a successful restructuring of its business and achieved significant efficiency improvements and cost reductions, with production and operating costs reduced by 45% and a 23% reduction in its global workforce as production was brought in line with demand.
The rights issue forms part of a wider refinancing package for De Beers designed to provide the company with a more appropriate capital structure and to secure ongoing banking facilities, at a time when the demand outlook for diamonds is improved, and to enable De Beers to invest in its future growth as the world’s leading diamond business.
Related posts:
- Anglo American agrees acquisition of Oppenheimer family’s 40% interest in De Beers for US$5.1 billion
- Anglo American and De Beers assist in preserving National Heritage Archives at the University of Fort Hare
- Anglo American: Diamond production increased by 15% to 9.0 million carats
- Anglo American Confirms Xstrata Proposal
- Anglo American shareholders approve acquisition of controlling interest in diamond giant De Beers by overwhelming majority
