Golden Share Rule No Longer Relevant - AGC

Officials of Ashanti Goldfields Company (AGC) have once more challenged the government to justify its continued Golden Share holding in the company, saying, "It is no longer relevant."

The Golden Share, according to the officials limits the company in several ways, adding, "besides, the stock markets do not understand why the government of Ghana discriminates against AGC shareholders with the Golden Share."

This view was expressed at a meeting of the Management of AGC with Journalists.

Mr Daniel Wiredu, Managing Director, Obuasi Mine, Mr Kwame Addo-Kufuor, Financial Controller, Obuasi Mine, Clement Asamoah_Owusu, Manager Geology-Exploration, John Owusu, Senior Manager, Corporate Affairs, Kwamena Sekyi-Yorke, Investor and Public Relations Manager and Mrs Elaine Kwami, General Manager- Human Resources at Obuasi attended the meeting over the weekend.

The officials insisted that there were options within the Mining Law to take care of any fears government might have had at the time the Law came into effect.

Mr Owiredu said; "the laws of a sovereign country should be enough to take care of its companies within laid down and agreeable terms, instead of insisting on a golden share."

He explained that the existence of the golden share was a serious "dampener" to the forward march of the company, which was now an international company.

Mr Owiredu said at the time the golden share was instituted, "Ashanti was a one-mine company situated at Obuasi. Today the company, has grown beyond that stage, expanded with fresh capital investment from others other than government, and is at present in three African countries - Tanzania, Guinea and Zimbabwe."

Ashanti, with a government of Ghana holding of 20 per cent, Lonmin 32 per cent and a free holding of 48.0 per cent is currently listed on the New York, London and Ghana Stock Exchanges where 1.7 per cent of the 4.7 million shares is traded.

According to the share structure, institutions in North America and in the European Union have 65 per cent and 20 per cent, respectively, while investors in Australia and Asia have a total of 13 per cent.

Individuals hold two per cent of Ashanti shares with Ghanaians holding 1.4 per cent and the rest in the hands of AGC workers.

Mr Addo-Kufuor, the Financial Controller, said the golden share issue was stalling the willingness of foreign investors to put extra money into the company.

He said those with investment in the company always hold on to their investment not knowing what the Ghana government might say at one time or the other.

Mr John Owusu questioned what the golden share was achieving for Ghana and asked: "Why is it that government has a golden share only in AGC and none of the other gold mining companies operating in the country?"

He asked what the people and government of Ghana would say if the government of Zimbabwe or Tanzania also insisted on taking a golden share in mining companies in their country.

"It is also important to note that the golden share rule has never been invoked."

The Journalists, notwithstanding, were of the opinion that even if for sentimental reasons government should hold on to the golden share.

This is because it would ensure that the headquarters of the company is not moved from Ghana and workers laid off indiscriminately.

It would also ensure that humanitarian activities to the mining community were not cut abruptly in the name of cost cutting which has become the order of the day in the name of efficiency, one of the Journalists stressed.