Randgold chair mulls takeover deals in Africa

 
Suzie Neuwirth
RANDGOLD Resources is eyeing acquisitions in sub-Saharan Africa to supplement its organic growth strategy, its new chairman said.

Christopher Coleman, who succeeded Philippe Lietard at the company’s annual meeting last week, told City A.M. that while the FTSE 100 gold miner typically preferred to develop its own projects, it would consider buying assets if they fitted its specific criteria. “The project would have to have at least 3m ounces of gold reserves and be able to generate 20 per cent returns, calculated at $1,000 (£594) per ounce,” he said.

“We’re looking at different opportunities, which would be greenfield projects owned by smaller miners that don’t have much capital.”

Randgold currently operates in Mali, Cote d’Ivoire and the Democratic Republic of Congo (DRC), but it would consider projects across sub-Saharan Africa, Coleman said.

The company, which unveiled a 14 per cent rise in first-quarter profit last week, is also looking to expand in Cote d’Ivoire, where it has around 10 more licence applications outstanding.

The Kibali mine in the DRC – Randgold’s largest project to date, which it owns with AngloGold Ashanti and the DRC government – was officially opened last week.

The project’s first hydropower station is set to come on line this week to power its operations using cleaner, cheaper fuel, taking advantage of the DRC’s heavy rainfall.

Randgold’s shares closed at 4,539p on Friday.