(Adds shares, CEO comments and background)
TORONTO/JOHANNESBURG, March 31 (Reuters) - South Africa's Anglogold Ashanti ANGJ.J does not need to pursue mergers and won't add scale for its own sake, its interim chief executive said on Wednesday, dampening speculation it could take part in further deals in the sector.
Sibanye-Stillwater SSWJ.J CEO Neal Froneman this month floated the idea of a merger with peers AngloGold and Gold Fields GFIJ.J , arguing consolidation is needed for South Africa's gold miners to compete globally. interim CEO Christine Ramon declined to comment directly when asked about a potential tie-up with Gold Fields during a roundtable at the Mining Indaba Virtual Investment Programme alongside Froneman and Barrick Gold ABX.TO head Mark Bristow.
Consolidation can bring benefits including operational synergies, but can also add complexity and costs, she said.
"I think bigger doesn't necessarily mean better. We wouldn't look to build scale just for the sake of it."
Ramon, who replaced Kelvin Dushinsky at the helm of Anglogold last year on an interim basis, said the miner is focused on developing its own assets and has the support of investors. "For us it's far more important not to get distracted," she said.
Shares of Anglogold were flat on Wednesday.
The stock initially rose 2.6% while Gold Fields fell 2.6% after Froneman floated the prospect of a deal on March 8. Sibanye shares fell 1.2% on that day.
Froneman has expressed interest in acquiring a mid-tier gold company with more than 1 million ounces and operations outside South Africa as it looks to build its gold business.
Sibanye, which started out as a pure gold producer, became the world's largest platinum miner with its 2019 takeover of London-listed rival Lonmin.
Gold generates less than 20% of Sibanye earnings currently, and the miner is keen to diversify beyond platinum to support a sustainable dividend, Froneman said on Wednesday.
"To do that you can't be cyclical," he told the panel. "You can't have a strategy or a policy that puts you at the vagaries of commodity prices."
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.