Agreemnt with Anaconda Nickel

ANGLO AMERICAN PLC 2 August 1999 ANGLO REACHES AGREEMENT ON 23% POTENTIAL HOLDING IN ANACONDA NICKEL LIMITED London, 2 August 1999. Anglo American plc (Anglo) announced today that it had reached agreement with Anaconda Nickel Limited, (Anaconda) an Australian listed company, in terms of which Anaconda will issue up to 77 309 516 new Anaconda shares to Anglo. In order to satisfy the requirements of the Australian regulatory and securities legislation, the placement of shares in Anaconda will occur in two tranches of 43 200 000 and 34 109 516 shares respectively. The transaction is subject to Australian Foreign Investment Review Board (FIRB) approval. In addition, the placement of 34 109 516 shares, in the second tranche, is subject to the approval of the shareholders of Anaconda at a general meeting, which is to be called as soon as is reasonably practicable. Should Anaconda shareholders approve the second tranche of the transaction, Anglo which currently holds 6,714,000 shares in Anaconda, representing 2.3% of the current issued share capital, will hold 23% of the enlarged issued share capital of Anaconda. The share consideration is A$3.15 per share, plus an additional payment obligation equivalent to A$1.00 per share. This compares with a closing price of A$2.15 per share at close on Friday 30 July 1999. The additional payment obligation becomes due in the event that, for a period of 60 continuous days within the three years following the transaction, the average share price of Anaconda reaches or exceeds A$4.15. This additional payment will not be due in the event that any third party makes or is required to make a take over offer for the shares of Anaconda as a result of which it would acquire a shareholding which is both higher than Anglo's shareholding and in excess of 30% of Anaconda's share capital. The total consideration payable by Anglo is therefore A$136.1 million on completion of the first tranche of the transaction and a further A$107.5 million on completion of the second tranche. In both cases this could be increased by a further amount equivalent to A$1.00 per share. Anglo and Anaconda have agreed that, upon completion of the first tranche of the transaction, Anglo will have the right to nominate two parties to the board of Anaconda. Commenting on the announcement, James Campbell, Chairman of Anglo American Base Metals said: 'This is a welcome opportunity for Anglo American to participate in the growth of a new and dynamic venture which has the potential to become a major force in the world nickel industry. Anglo is committed to a policy of participating in long life, low cost projects and we strongly believe that our alliance with Anaconda will serve this end.' NOTE TO EDITORS Anglo American plc listed on the London Stock Exchange on 24 May 1999 and was admitted to the FTSE 100 Index on 21 June 1999. Interim results for the six month period January to June 1999 are due to be announced on 8 September 1999. Anaconda (www.anaconda.com.au), which had a market capitalisation of A$619 million at close on 30 July 1999, is a nickel mining and exploration company currently developing the lateritic nickel deposit of Murrin Murrin in Western Australia. A copy of the company's cash flow statement is attached hereto. Queries: London: Nick von Schirnding Misha Nagelmackers Tel: +44 171 698 8540 Tel: + 44 171 698 8567 Mobile: +44 777 1 737 055 Johannesburg: Anne Dunn Tel +27 11 638 4730 Mobile: +27 82 448 2684 MINING EXPLORATION ENTITY QUARTERLY REPORT Quarter ended ('current quarter') 30/06/1999 CONSOLIDATED STATEMENT OF CASH FLOWS Cash flows related to Current Year to date operating activities Quarter (12 months) AUD'000 AUD'000 1.1 Receipts from product sales and related debtors - - 1.2 Payments for (a) exploration and evaluation (3,980) (21,600) (b) development (24,958) (171,700) (c) production - - (d) administration (786) (2,614) 1.3 Dividends received - - 1.4 Interest and other items of a similar nature received 1,658 9,079 1.5 Interest and other costs of finance paid. (3,716) (64,700) 1.6 Income taxes paid - - 1.7 Other - Proceeds from term deposits 8,332 44,600 - Contract proceeds - 45,011 - Payments into term deposits - (1,981) - Effect of exchange rate movements (1,566) 1,542 Net Operating Cash Flows (25,036) (152,363) Cash flows related to investing activities 1.8 Payment for purchases of: (a) prospects - - (b) equity investments (2,197) (29,048) (c) other fixed assets (60) (200) 1.9 Proceeds from sale of: (a) prospects - - (b) equity investments 693 693 (c) other fixed assets 22 22 1.10 Loans to other entities - - 1.11 Loans repaid by other entities - - 1.12 Other (provide details if material) Net investing cash flows (1,542) (28,533) 1.13 Total operating and investing cash flows (26,578) (190,896) Cash flows related to financing activities 1.14 Proceeds from issues of shares, options, etc. - - 1.15 Proceeds from sale of forfeited shares - - 1.16 Proceeds from borrowings 4,438 74,345 1.17 Repayment of borrowings (169) (749) 1.15 Dividends paid - - 1.12 Other (provide details if material) - - Net financing cash flows 4,269 73,596 Net increase (decrease) in cash held (22,309) (117,300) 1.20 Cash at beginning of quarter/ year to date 33,075 129,569 1.21 Exchange rate adjustments to item 1.20 (1,193) (2,686) 1.22 Cash at end of quarter 9,583 8,583 (a) Total cash including term deposits at the end of the quarter was $116,232,821.
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