Wednesday, 16th November 2005 (2669 views)

South African gold producer Harmony has raised 2.47 billion rand by dumping its remaining 5.4 per cent stake in rival Gold Fields.

The cash will be used to fortify Harmony's balance sheet after the company saw cash and equivalents sink by almost a half (47 per cent) during the three months to September.

Harmony bought an 11.5 per cent stake in Gold Fields after launching a hostile takeover bid for its larger rival.

The bid collapsed in May and Harmony sold half of its holding in June.

Today's (November 16th) divestment may have surprised onlookers after Bernard Swanepoel, Harmony's chief executive, denied Harmony would go ahead with the sale.

But he later confirmed that 26.5 million shares had been divested at an average of 93.2 rands each.

Harmony - which carries out 90 per cent of its production in South Africa - is the world's sixth biggest gold producer. Gold Fields is the world's number four gold outfit.

 

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