Harmony drafts in FD for hostile bid for gold rival

Johannesburg: Harmony Gold Mining Company has drafted in Financial Dynamics to handle communications around its hostile bid for South African rival Gold Fields.

FD managing director Nic Bennett is advising Harmony on international aspects of the deal while South African PR firm Beachhead Media & Investor Relations is handling domestic IR for the Johannesburg-listed firm.

Gold Fields, which has used Brunswick as its international financial PR adviser since May, has rejected Harmony’s offer, which values Gold Fields at £4.5bn, and has said that the deal ‘significantly undervalues’ the company which is the world’s fourth-largest gold miner.

Brunswick partner Robert Pinker is leading the team advising Gold Fields in Johannesburg while the firm’s founder Alan Parker directs proceedings in London.

Harmony CEO Bernard Swanepoel has said the firm needs a 15 per cent cost reduction in Gold Fields’ South African assets to justify the 29 per cent premium it is offering for Gold Fields. That premium is based on Harmony’s 1:1.275 share-for-share offer multiplied by the ZAR84.41 closing price of Gold Fields shares last Friday.

If the merger was to go ahead, it could mark the biggest consolidation of the gold-mining industry since AngloGold’s buy of Ashanti Goldfields last year (PRWeek, 13 August 2003) created the world’s biggest gold miner.

Gold Fields is itself in the midst of a £1.1bn takeover of Canadian gold miner IAMGold, announced in August, and has urged shareholders to support the company’s board in pressing ahead with the deal.

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