Anglo American plc is one of the worlds largest mining and natural resource groups. With its subsidiaries, joint ventures and associates, it is a global leader in platinum group metals, gold and diamonds, with significant interests in coal, base and ferrous metals, industrial minerals and paper and packaging. The group is geographically diverse, with operations in Africa, Europe, South and North America, Australia and Asia.

            Red = 25 day moving average.           Green = 200 day moving average.

SALES PER ACTIVITY (Data as of 31/12/2005)

Packaging and Paper: 23%
Ferrous metals:         20.5%
Industrial minerals:    14%
Platinum:                 12.5%
Nonferrous metals:    12%
Coal:                       9%
Gold:                       9%

Further to the announcement of 23 March 2006 (a copy of which is available on
the Company's website), Anglo American plc purchased 1,025,000 of its ordinary
shares on 27 April 2006 at prices between 22.85 and 23.67 per share. The
purchased shares will all be held as treasury shares.

Aug. 4 (Bloomberg)

Anglo to Return $5 Billion to Investors; Profit Soars (Update6)


Anglo American Plc, the world's second-biggest mining company, said it will spend $5 billion buying back stock and paying dividends after first-half profit jumped 60 percent.

Record prices for copper and zinc prompted Chief Executive Officer Tony Trahar to focus on Anglo's main mining units by selling a steel mill and planning to spin off paper and sugar plants. That contrasts with rivals Xstrata Plc, Barrick Gold Corp. and Phelps Dodge Corp. making acquisitions.

Net income rose to $2.94 billion, or $2 a share, from $1.84 billion, or $1.27, a year earlier, the London-based company said in a statement today. Anglo will increase a share buyback program by $4 billion and pay out $1 billion in a special dividend.

``You don't want to go and buy commodity companies when commodity prices are at multi year highs,'' Wayne McCurrie, who oversees the equivalent of $7.2 billion at Advantage Asset Management in Johannesburg, said in an interview. ``They've taken flak for not buying assets in this boom, but you can rest assured that they'll go shopping at the right time.''

Since Trahar, 57, announced a reorganization plan on Oct. 26, shares of Anglo have gained 49 percent while those of rival Rio Tinto Group have advanced 32 percent and shares of BHP Billiton, the world's biggest mining company, have climbed 28 percent.

The company expects to have a ``very strong second half'' if current metal prices are sustained, Trahar said in a televised interview. The mining industry is ``cash flush'' and Anglo may consider another share buyback program, he said.


Contrast With Peers

Xstrata is bidding C$19.2 billion ($17.1 billion) fro Canadian nickel producer Falconbridge Ltd. while Phoenix, Arizona-based Phelps Dodge Corp. is battling with Teck Cominco Ltd. of Vancouver to buy Inco Ltd., the world's second-largest nickel producer. Bidding has reached $14.7 billion. Barrick is bidding for NovaGold Resources Inc.

The rally in commodity markets, now in its fifth year, has sent prices for raw materials to records. Copper has more than doubled in the past year, and nickel is up 77 percent. Gold has surged almost 50 percent, reaching a 26-year high in May.

``We did a lot of our merger and acquisition activity at the bottom of the cycle and that's stood us in good stead,'' Trahar said. ``We can do big-scale acquisitions if we choose to.''

Shares of Anglo rose 107 pence, or 4.8 percent, to 2,330 pence in London, the highest since May 12 and valuing the company at 35.4 billion pounds ($67.6 billion). The South African shares rose as high as a record 308.49 rand, closing at 302 rand.


Nickel Mine

Anglo will decide in the fourth quarter whether to build a $1 billion, 40,000 metric ton-a-year nickel mine at Barro Alto in Brazil, it said in the statement. Anglo is also considering a project in China to convert coal into chemicals, and will decide on two Chilean copper mine expansions next year.

Anglo's rivals are also giving cash back to shareholders. Rio in February said it will return $4 billion by buying its own stock and paying a special dividend. BHP Billiton has a $2 billion share buyback and increased its dividend in February.

``These companies are throwing off enormous amounts of cash,'' said Ian Henderson, who manages about $2.5 billion in natural resource assets for JPMorgan Asset Management in London. ``It's the most wonderful situation for them to be in.''

Anglo's earnings-per-share before one-time items and goodwill amortization was $1.70, compared with the $1.81 median estimate of four analysts surveyed by Bloomberg.

BHP Billiton, based in Melbourne, posted a 48 percent gain in fiscal first-half net income to a record $4.36 billion. Rio, based in London, yesterday said first-half profit rose 75 percent to a record $3.8 billion.


Steel, Paper

Since Trahar announced the company's change of tack last October, Anglo has sold Highveld Steel & Vanadium Corp. in South Africa and announced plans to spin off its Mondi paper unit this year. The company also cut its stake in AngloGold Ashanti Ltd. by a fifth. Anglo has decided to retain its Tarmac asphalt business.

While contract prices for iron ore rose 71.5 percent last year and a further 19 percent this year, the prices of some of the Anglo's main metals, such as gold and platinum, have risen at a slower pace. The price of gold advanced 65 percent over the last two years while platinum gained 50 percent.

Anglo's earnings were also curbed by prices for diamonds set by De Beers, the world's biggest diamond producer, in which it has a 45 percent stake. De Beers cut some prices in July after a 2 percent price increase earlier this year. First-half sales were $3.25 billion, below the $3.45 billion median estimate of four analysts polled by Bloomberg.

Second-quarter earnings per share at AngloGold Ashanti were 3.34 rand, below the 3.87 rand median estimate of analysts. Anglo Platinum Ltd., 75 percent owned by Anglo American, more than doubled first-half profit to 4.5 billion rand ($655 million).

The Observer - Sunday August 20, 2006 - Richard Wachman

Anglo American braced for $80bn break-up bid - Expanding economies drive a race to consolidate in industry flush with cash


Anglo American, the mining giant headed by Tony Trahar, is an $80bn bid target for rivals that are awash with cash thanks to the commodities boom being fuelled by China and India.

According to City sources, CVRD of Brazil, along with British-based Xstrata and Rio Tinto, are looking at a possible break-up bid and have hired financial advisers ahead of a possible approach.

The sector is undergoing a period of rapid consolidation as the miners scramble to secure supplies of iron ore, coal, copper and nickel - resources that are vital to the Asian economic miracle. China now consumes about 30 per cent of global mining production and there is no sign of any let-up.

An investment banker said: 'Anglo has been shedding businesses to streamline its operations, but many investors would like it to go on the front foot and buy assets that are being snapped up by its competitors. If it doesn't, it could find itself prey rather than predator, and someone else could break it up.'

Xstrata under Mick Davis has just emerged from winning a takeover battle to acquire Falconbridge of Canada, the copper and nickel group, while CVRD, primarily an iron producer, has entered the fray to acquire Inco, another Canadian metals company. Davis has refused to rule out a bid for Anglo, and bankers say the market would probably react positively even if Xstrata had to tap investors for funds via a rights issue.

Xstrata is about half the size of Anglo in terms of its current market value, but as debt is cheap, analysts believe that Davis wouldn't face any difficulties if it needed to raise cash.

Anglo is worth $60bn but any bidder would have to pay a bid premium, taking the full cost up to $80bn, say experts. But observers say that rivals such as Davis may wait until Anglo has shed Mondi, its paper division, which is to demerge and separately list under new management before the end of the year. Anglo is also to sell its stake in Africa's Anglo-Gold Ashanti as part of a restructuring that will see it focus on base metals, coal and platinum. City analysts say disposals could net the company about $8bn.

Some mining experts believe that Anglo will become more open to mergers and tie-ups early next year when boss Trahar takes early retirement. 'Anyone wanting an alliance with Anglo could find themselves pushing at an open door,' said one analyst.

There was speculation last week that investors in Anglo were pressing for an outside candidate to replace Trahar, and somebody more receptive to dealmaking. Anglo announced that it was streamlining its operations last year after shareholders complained that the stock price was underperforming its peer group and compared unfavourably with valuations ascribed to shares in companies such as BHP Billiton, 'the juggernaut of the sector'.

The Times - October 24, 2006

Anglo American prepares to name new chief - By David Robertson


ANGLO AMERICAN will name a new chief executive to replace Tony Trahar in the next few days, The Times has learnt.

Mr Trahar will retire at the companys annual general meeting next March and Anglo has been seeking a replacement for the past six months.

Philippe Varin, the chief executive of the steel-maker Corus, was an early favourite for the job but he is understood to be no longer in the running. Mr Varin has said that he was committed to seeing through Coruss acquisition by the Tata Group.

Internal candidates are thought to include Rene Medori, the finance director, and Simon Thompson, head of the base metals division.

Anglos headhunter, Spencer Stuart, is also thought to have been interviewing senior executives at both BHP Billiton and Shell. The company yesterday refused to comment on the timing of an announcement except to reiterate earlier guidance of before the end of this year.

The imminent appointment of a new chief executive comes as Anglo is again the centre of takeover speculation. Brian Gilbertson, who will become non-executive chairman of Rusal, the Russian aluminium company, is understood to have targeted Anglo for a possible reverse takeover next year.

Anglo is considered vulnerable by many mining analysts because its wide spread of divisions are ripe for breaking up. In recent months Anglo has been linked with Rio Tinto, Xstrata and others.

Numis Securities in a note to clients yesterday said: It increasingly appears that there may be a hotly contested battle for Anglo American, the key protagonists being Xstrata, CVRD, Rusal and, somewhat less likely, Rio Tinto. Further players, such as a Chinese consortium, joining the fray is also possible.

Anglo is a sprawling industrial conglomerate that includes some of the worlds biggest mines, a 51 per cent stake in AngloGold Ashanti and a 45 per cent stake in De Beers.

It has been divesting non-core assets in a bid to improve its focus and will seek an initial public offering for its Mondi paper and packaging division later this year, which could raise about $7 billion.

Anglo is also considering the sale of its 51 per cent stake in AngloGold Ashanti.

The companys supporters insist that Anglo is on track and its share price has risen 37 per cent since October last year, when it announced a strategic review of its various divisions. By comparison BHPs shares are up 21 per cent and Rios 28 per cent.

Anglo will also return $7.5 billion (4 billion) to shareholders this year through buybacks.

With both Xstrata and Brazils CVRD having just completed deals worth more than $20 billion and Rusal integrating its rivals Sual and Glencore, a takeover may not be possible until next year. Also, Mr Gilbertsons hopes may not sit well with Rusals existing management.

Numis said: We continue to believe that an Anglo American take-out is a 12- to 18-month story.

The Times - October 24, 2006

Anglo's new boss has his work cut out - James Harding


ANGLO AMERICAN is about to appoint a new chief executive. This is one of the best jobs in world business. It is also one of the easiest.

This may seem a strange thing to say about running a politically fraught business operating dangerous machinery underground in unstable countries and selling into an unpredictable market. Anglo employs 195,000 people, many of whom work deep down mines or, literally, at the coal face. Anglos future prospects lie in such investor-friendly locations as the Democratic Republic of Congo and Russia. Its reputation, particularly in South Africa, is as volatile as the price of its commodities.

And its image is as a listless company that it is no longer judged by its own merits, but by the likelihood of an imminent takeover or break-up.

The chief executives job at Anglo is, nonetheless, a gift. The contribution of the outgoing chief executive, Tony Trahar, has been widely under-estimated. Mr Trahar has set in train the structural changes needed to focus the company on its future as a diversified miner. It will spin off Mondi, the packaging business and it is selling down its stake in Anglo Gold. As you would expect of a business riding a commodities boom, the numbers are strong: Anglo reported earnings up 47 per cent at its interims in August. There is a $6.2 billion (3.3 billion) pipeline of projects approved for development and a further $10-$15 billion of projects on the drawing board. Even amid the talk of managerial drift at Anglo, the share price is nicely buoyed by the expectations of a bid for the company.

In short, Mr Trahars successor has a gaping opportunity to turn around perceptions, providing a new personal dynamism, while profiting from the underlying momentum of the business. The person able to make the most of this opportunity is an outsider. The appointment of someone who did not grow up in Anglo will itself signal an appetite for change. Mr Trahar joined Anglo American in 1974.

In London, there has been speculation that Philippe Varin, the boss of Corus, is being lined up for the job. In fact, Mr Varin has been approached, but told Anglo that he wants to stay at the steelmaker. In South Africa, there has been talk that Miklos Salomon, who begins a relatively youthful retirement from BHP Billiton at the end of this week, will be asked to lead Anglo. That, too, may be wishful thinking. Anglo would have to wait for the better part of a year, before Mr Salomon had served out the non-compete clause in his contract.

Whoever gets the job will be measured by his ability to maintain Anglos independence. Success means showing investors that Anglo can manage its assets better than a rival, say Rio Tinto or Rusal. To achieve that, the next chief executive will have to: one, renew focus on costs and efficiencies; two, complete the portfolio restructuring; three, improve the communication and definition of strategy; and, four, drive ahead a select list of new priorities, making difficult choices between projects in Peru, Brazil, Congo and Russia. Most importantly, he will need to be able to manage people. Anglo, even after its planned spin-offs, will have about 125,000 employees, by comparison with 32,000 at BHP, 28,000 at Rio. He and, lets face it, the next Anglo boss is most likely to be a man would also be well-advised to seek to depoliticise the company in South Africa.

Anglo American should not be defined as a takeover target. It should be redefined by its next chief executive.

The Times - October 25, 2006

Shares drop as Anglo names new chief - By David Robertson


ANGLO AMERICAN, the worlds third biggest mining group, lost 544 million in value yesterday after appointing Cynthia Carroll, a relative unknown, as chief executive.

Mrs Carroll, who will receive a salary of up to 4 million a year including bonuses, has spent the past 18 years at Alcan, the Canadian aluminium producer.

Analysts were surprised by the choice because Mrs Carroll has a low profile outside the aluminium industry, and they questioned what abilities Anglo had seen in Mrs Carroll that Alcan had not when it passed her over for the chief executives job this year. Anglo American pointed out that Mrs Carroll, who was president of Alcans primary metals group, has a strong record in developing project pipelines.

Anglo is in the middle of a restructuring that will see it divest non-core assets and its lack of focus has led to speculation that it will become the target for predators wanting to break it up.

The companys share price dropped 36p to 23.79 after the appointment. But Mrs Carroll, who will replace Tony Trahar when he retires on March 1, told The Times last night that she was unconcerned by the market reaction. She said: There are a lot of challenges ahead and I dont want to lose the momentum that Anglo has built up in its restructuring programme.

Cynthia Carroll

Telegraph.co.uk - 25/10/2006

Who is Cynthia Carroll? - by Katherine Griffiths


Anglo American appoints FTSE's third female CEO

Cynthia Carroll will be the first woman and outsider to become chief executive of Anglo American in its 89-year history. Moreover, the 49 year old American will become only the third female chief executive of a FTSE 100 company. The others are Dame Marjorie Scardino, chief executive of publishing group Pearson, and Dorothy Thompson at the power station operator Drax. Ms Carroll studied at the University of Kansas and has an MBA from Harvard.

She started her career as a geologist at Amoco, now part of BP, and joined Montreal-based Alcan in 1988. Her roles at the Canadian company have included heading up a division in Ireland. Alcan is the world's second-biggest aluminum producer, behind Alcoa.

On taking up her post next March Ms Carroll will receive a basic salary of 900,000. On top of that she will be able to earn up to 1.3m through one bonus scheme and 1.6m via a long-term incentive plan. Ms Carroll will start her job on a two-year contract, which reduces to a one-year notice period after the first 12 months. She will be compensated for loss of bonus at Alcan.

Other high flying women in UK boardrooms include Linda Cook, head of Shell's gas and power interests, Rona Fairhead, chief executive of the Financial Times, and Alison Carnwath, who sits on various boards including Man Group, Friends Provident and Gallaher. There are a total of 13 women holding executive director roles at FTSE 100 companies, down from 20 a year ago.

Ms Carroll is currently a director of Sara Lee and sits on the board of the American Aluminium Association and the International Aluminium Institute.

That would explain the price drop today LOL.

Telegraph.com - 29/10/2006

Carroll: 'I can cut it at Anglo'

The new head of Anglo-American, Cynthia Carroll, is unfazed by the torrent of criticism and the 500m drop in the share price that greeted her appointment. She talks to Sylvia Pfeifer


It was hardly an auspicious start. When Anglo American, one of the world's largest mining companies, announced it had appointed Cynthia Carroll, an unknown executive from Alcan, the aluminium company, as its new chief executive, investors sent the shares tumbling down.

But if Carroll is in any way concerned or embarrassed about having wiped more than 500m off the 35.6bn market value of her new employer in just one day, she certainly doesn't show it. In an interview with The Sunday Telegraph, Carroll says: "It doesn't concern me one bit".

Has she bought any shares yet to show her commitment to her new employer? The answer elicits a bout of laughter. It turns out that Carroll has been bombarded with e-mails from people saying they are buying. Will she follow suit? She won't say.

Anglo has traditionally always appointed an insider, and the market had speculated that the external frontrunners were more well-known industry figures such as Philippe Varin, the head of Corus. No one expected a conservative company like Anglo to appoint an unknown, let alone a woman. Carroll insists that, just like the share price reaction, the blanket press coverage of her being the first woman to lead a mining group miners have traditionally not allowed women underground believing it would bring bad luck has not phased her.

"It's not an issue from my standpoint," says Carroll. "I've worked in male-dominated industries and environments my entire career It just comes down to delivering performance and results and building a global company that is joined together and moving all in the right direction. I think that initial reaction will dissipate pretty fast."

When Carroll takes over from Tony Trahar, the outgoing chief executive, next March, she will join the relatively short list of unknown Americans Eric Daniels at Lloyds TSB, Arun Sarin at Vodafone and Marjorie Scardino at Pearson spring to mind whose appointment took the City by surprise. Not all of them have been an unqualified success.

The 49-year-old has a challenge on her hands. Although Carroll lauds the company's "tremendous asset base" and "fantastically proud workforce", she will need a lot more if she is going to build Anglo into a truly global miner.

Despite the recent commodities boom, the company's share price has lagged that of the rest of the industry over the past few years, partly because of the perceived political risk associated with South Africa as well as the company's smaller exposure to base metals. It moved its primary listing from Johannesburg to London in 1999, but in a sign of just how important South Africa remains to Anglo's fortunes, Carroll flew to Johannesburg right after her appointment was made public for a meet-and-greet with her new colleagues.

Unlike international rivals BHP Billiton and Rio Tinto, Anglo is also still in the midst of transforming itself from a South African gold and platinum miner, a transformation begun by Trahar. Last October, Trahar unveiled a restructuring plan designed to boost its stock, including the demerger of Mondi, its paper and packaging business, and the sale of shares in AngloGold Ashanti, its South African gold division.

The moves have been welcomed by investors, but analysts say the company's new CEO now needs to cut costs and improve the productivity of its resource base. Heath Jansen, analyst at Citigroup, points out that last year, Anglo's salary costs were a massive $5.4bn compared with $2.3bn at Rio Tinto.

Carroll refuses to talk about her plans for Anglo, arguing that she needs to get her feet on the ground first.

"I really need to understand how we fit, and what further opportunities there are to enhance our position and to extract more operational excellence from the asset base," is all she will say.

What, though, of the fact that she has no experience running a diversified mining company, let alone one the size of Anglo American? At Alcan, Carroll was a divisional head, albeit of the company's largest.

No problem, says Carroll. "I have a geology background, which is a big plus. I understand the language, I can appreciate the context, that is number one. More directly related to the business, I have been working in a global context in a big way, I was very involved in the Pechiney integration [bought by Alcan in 2003]."

Nor is she a novice when it comes to dealing with governments. At Alcan, where her division employed 18,000 people in 20 countries, she also worked with governments around the world, from Oman to the Middle East to China.

Dealing with the South African government, whose relations with Anglo have not always been cordial, will not be a problem, according to Carroll who says she is looking forward to "spending some more time" with them.

Carroll comes across as someone who is, at the very least, up for a challenge. She intends to move to London in January, while her husband and her four children, aged seven to 13, will follow later in the summer. Asked how she has managed to juggle such a large family with a career her husband, whose background is in accounting and finance, stayed at home after the birth of their fourth child just after they moved from Ireland to Montreal she credits her ability to set priorities.

"I live a very balanced life," she says. "I am very good at delegating responsibilities." Her husband, she says, has never been resentful and "takes satisfaction in the way our children are today".

Whether Carroll ultimately fares better than some of her American counterparts remains to be seen. Ultimately, her appointment at Anglo is perhaps less relevant than the fact that the position has been filled by an outsider someone who, unlike Trahar, carries no historic baggage.

Says Citigroup's Jansen: "They need an outsider to alter the DNA of the company, to change the culture."

Telegraph.com - 29/10/2006

Business comment - By Dan Roberts, Sunday Business Editor

Boards should listen without prejudice



Tony Trahar may have big hands and a grip that could crush rocks but to listen to some of the talk in the mining industry last week you would think the outgoing chief executive of Anglo American was down there every morning digging out diamonds with his fingernails.

The accepted version of events is not without pathos. The scene opens in a macho saloon bar full of male mining characters with butch nicknames like "Big Mick". Whenever they go down the mine, they are reminded of the old superstition that says it is bad luck to let women go underground.

Then last Tuesday, a door swings open and in walks the new boss: a woman. Once the gruff coughing subsides, word leaks out to the investors and there is a run on the share price. Before the day is ended, some 500m has been lost and the shareholders have revealed themselves to be almost as irredeemably sexist as the companies they own.

Unfortunately, this interpretation of the City's reaction to the appointment of Cynthia Carroll as Anglo American's chief executive is as misleading as it is simplistic.

The first myth to knock on the head is that the men running global mining are all horny-handed sons of toil whose cultural attitudes are stuck in the 19th century. Today's global mining companies are thousands of miles from the coal face literally. Based mostly in London, these multinational giants may have more swagger than some but there is nothing spit and sawdust about their modern, cosmopolitan headquarters.

More importantly, the shareholders who reacted so unenthusiastically to Carroll's appointment should not be dismissed as sexist just because they do not think she is up to the job. No doubt some of the more trigger-happy traders may have been encouraged to mark down Anglo shares on some misguided notion that this is man's work, but the idea that so much real money would have been taken off the table on a whim is hard to swallow.

Genuine concerns remain about Carroll's limited qualifications for the job and why the board failed to attract the more senior candidates it was widely known to have been pursuing. The lingering suspicion is that the 49-year-old American is there because she ticks the right boxes for today's breed of politically correct headhunter rather than because she is the ideal candidate to lead Anglo through its big challenges. It would not be the first time.

There are far too few women at the top of big companies, but there are also far too few women in the middle of big companies. Until this is addressed, no amount of fast-tracking will fix the problem. For every positive discrimination candidate who succeeds there will also be those who do not casting unfair suspicion on those who do get there by merit.

In management as in everything thing else, what matters is ability. Age, gender, race and sexual preference are all about as relevant as the size of Tony Trahar's hands.

The Sunday Times - October 29, 2006

Anglo a new chief and a new direction - DOMINIC O'CONNELL


EXECUTIVES reading our exclusive interview with Cynthia Carroll, the new boss of Anglo American, will be chuckling appreciatively by the end.

Unlike many incoming chief executives, who are only too keen to throw their weight around and talk about their big plans for their new commands, Carroll carefully avoids offering too many hostages to fortune.

She is wise to do so. She is taking over from a long-serving chief executive, Tony Trahar, who oversaw a steady process of diversification away from the core mining activities, only to begin to reverse the policy towards the end of his time with the company. The end result is the creation of Mondi, a new company that will be created later this year by the spin- off of Anglos paper and packaging interests.

To offer a snap judgment on where Anglo needs to go from here would simply be tempting fate. But as Carroll does her tour of the African mines that are the companys heartbeat, she should reflect that in choosing her, the board was in effect embracing a mandate for change.

If the directors wanted Anglo to continue on its familiar path, they would undoubtedly have chosen an insider, or a South African (all the companys bosses have to date been South Africans), or an experienced executive from another mining company.

But they didnt. They chose a rank outsider, one with almost no profile in the City, and as if to make a point in a male-dominated industry a woman.

Carroll should take that as a clear indication that she can take a radical approach. I would bet the shake-up of Anglo started by Trahar will accelerate.

The Times - November 11, 2006

Chinese tycoon in $800m Anglo share buy - By Carl Mortished


The Oppenheimer family has sold a third of its stake in Anglo American to China Vision Resources, a company controlled by the Chinese tycoon Larry Yung.

E Oppenheimer & Sons, the family investment company, said that it had sold 17 million shares in the mining company, which was founded by Sir Ernest Oppenheimer early in the last century.

The family will continue to hold 40 per cent of De Beers, the diamond group and its remaining 2 per cent in Anglo.

The value of the deal, which was not disclosed, is likely to have been in excess of $800 million (418 million).

Shares in Anglo gained 2 per cent yesterday in response to the purchase by China Vision Resources, a special purpose vehicle created for the transaction.

Anglo has world-class interests in platinum, gold, diamonds and coal, mainly in southern Africa, but the company has been the subject of bid speculation and is engaged in a restructuring and sale of its non-mining interests.

Demand for metals is soaring in China and the country is already a leading consumer of precious metals, such as gold and platinum, owing to an anticipated surge in demand for catalytic converters in a fast-growing nation of car owners.

Larry Yung, who is believed to be behind China Vision Resources, is the chairman of Citic Pacific, a Hong Kong-based conglomerate with interests in steel, iron ore, property and infrastructure. Mr Yung topped Chinas rich list last year in Forbes magazine, with an estimated personal fortune of $1.6 billion.

Nicky Oppenheimer, the chairman of De Beers, said that the sale reflected the familys desire to diversify its holdings into areas other than mining. Mr Oppenheimer was at pains yesterday to declare his support for the restructuring and last months appointment of Cynthia Carroll as chief executive.

She is just the right person to lead Anglo into the future, he said.

Chinese companies are engaged in a scramble to acquire control of mineral resources in Africa. The countrys construction and manufacturing expansion is sucking in imports of copper and iron ore, as well as precious metals, such as platinum.

The leading Chinese oil companies CNOOC, CNPC and PetroChina are scouring the continent for hydrocarbons. Angola is already a leading supplier of crude oil to China.

Broker note from Numis today (summary):
"The mining sector lends itself to long-term analysis. This report, six months
in the making, argues that sector equities are 'myopic', attributing little value to
company pipelines and the power of Chinese urbanisation. The combination of
these factors will produce upside to current share prices of 50-100%. Anglo
American is our top pick."

Credit Suisse has lowered its price target for diversified miner Anglo American from 2,500p to 2,200p after slashing its forecasts on the back of lower volumes within copper and iron ore. The broker said that Anglo is expected to lag peers on volume growth over the next two years (2-3% per annum in 2013/14); "we believe the market continues to underestimate the potential margin squeeze in 2013 and beyond." Earnings per share (EPS) estimates for 2012, 2013 and 2014 have been reduced by 7%, 3% and 13%, respectively. With the valuation being "far from compelling", the broker maintains its 'hold' rating on the stock

Shares in Anglo American ended October 86p up on 1,903p. That's only a little under 5%, but it could be the start of something bigger.

Anglo shares have crashed this year as the miner's profits took a hit -- disproportionately higher than the rest of the sector, so it wasn't all down to falling commodities demand. But the shares have been creeping up over the month, and got an extra boost when the firm announced that chief executive Cynthia Carroll is to step down.

The well-publicised problems surrounding platinum mining in South Africa remain, but if they can be addressed over the next few months, it could turn out that we're at a good buying opportunity now.

Anglo American appoints new Chief Executive

Anglo American appoints Mark Cutifani as Chief Executive

Anglo American plc ("Anglo American") announces the appointment of Mark Cutifani as Chief Executive, with effect from 3 April 2013.

Mark Cutifani has been Chief Executive Officer of AngloGold Ashanti Limited, the South Africa-based gold producer, since 2007 and has led the successful restructuring and development of its business, which includes operations in ten countries on four continents.

Prior to his current role, Mr Cutifani was the Chief Operating Officer of CVRD Inco, the Canadian nickel company. He started his career in the coal and gold mining industries in Australia and has experience across a wide range of commodities. He has a degree in Mining Engineering and is the current President of the South African Chamber of Mines.

Fall in output http://www.moneyam.com/action/news/showArticle?id=4689330

JP Morgan Cazenove reiterates underweight on Anglo American, target cut from 1040p to 980p.

RBC note today:
"New headwinds face Anglo: We have adjusted our model for the recent Q1 production, and remodeled AngloPlat to come to a lower value. In addition, we see De Beers contributing less this year to Anglo because of soft conditions in diamonds which will limit volume and sales prices, and slow the rehabilitation of Anglo's balance sheet. The contribution of the bulks in the portfolio also remains under pressure. These factors have led to a lower valuation in our model and a change in Price Target to £9/share, with a downgrade in our recommendation to Underperform.
Challenging the "cheap" tag: Anglo's forward EBITDA and P/E multiples seem to compare favourably with its peer group, and it remains the most diversified of the large miners. But over the next few years free cashflow generation remains under pressure, and is threatened under a weaker price scenario. Essentially, debt continues to grow through 2017 as, on our numbers, free cash flow remains negative. Anglo's structure contributes to multiples appearing more attractive than they are, we believe. Using EBITDA as a proxy for cash flow, we modify Anglo's figures to account only for the cash received from AngloPlat and Kumba (ordinary dividends), and proportionately consolidate the EBITDA of De Beers. The result is a worsening in EV/EBITDA multiples relative to the peer group
Diamonds slow: De Beers was the largest contributor the earnings in 2014, and looks set to remain near the top of the ranking in 2015. Conditions in the diamond market have deteriorated with the result that Anglo has guided down De Beers' production this year from 32-34mct to 30-32mct; and we see potential for sales to suffer more in the near-term with prices under some pressure. We have modeled lower sales and prices and this results in De Beers' contribution to Anglo's bottom line falling from $776m to $428m.
The dividend intact for now: We do not see Anglo cutting its $1.1bn ordinary dividend this year, though it will remain a discussion point, we think, given negative free cashflow and rising debt due to still significant capex in iron ore, metcoal and diamonds.
Changing numbers: We adjust our model which results in cuts to our EPS and CFPS forecasts. Our FY15E EPS forecast of $1.15/sh compares with consensus of $1.04/share; our FY16E EPS reduces to $1.37/sh, vs. consensus at $1.48/sh. Our NAV cuts to £11.95/sh. As a result our Price Target, based on 1x NAV and 9x a blend of FY15E and FY16E EPS, reduces to £9/sh.

Investec retains hold on Anglo American, target cut from 1062p to 872p.