Peter Well-known to Cyril, Gwede: Don’t let Aussies engage Anglo. Give mining a risk to grow SA.

but it's not too often that the financial times of London dedicates much of its focus on a South African company but indeed it's done that this morning three stories in the Ft our partners there in London focusing on Anglo American the 107y Old South African beim moth being uh well put into play by a.

Bid from the big Australian BHP vtin not the first time the Aussies have raided South Africa for its Jewels it did this with Jen cor which became biltin some years ago and we'll be talking to our goto man on mining Peter major to find out what gives well good evening your time.

Morning Our Time Peter we've tracked you down to Idaho what you doing over there at the moment hey it's not all just about gold and diamonds you know it's also about silver Alec I can't say we're the silver capital of the world anymore over here but it's still the world's richest deepest Silver Mines Idaho uh is in what's the northwest corner of the.

United States of America that's right it's quite a ways from the Iowa that you always go to Aha yeah little bit little bit from Warren Buffett's territory so Omaha uh is quite away from from I Ido uh but Peter it's not often that anglo-american is well you would you would hard it's inconceivable in fact that anglo-american would be uh on the.

Block would be uh an attempted purchase by especially by a company that was much smaller than it not that long ago but yesterday in my conversation with pet fun he said it's a reflection of South Africa's difficulties on the other hand perhaps uh it's not just the opportunistic by BHP to come and try and buy Anglo because of the low share price.

But because we are on the verge here in our country possibly of a big turnaround we've got Coalition politics coming in after May the 29th and perhaps that's what's motivating Melbourne to say well let's get in now let's grab them now before uh Anglo does come back to its former glory or am I just being way too optimistic no I I think you're pretty.

Close Alec if you look at where anglos is trading relative to the S&P 500 you know that's a worldclass benchmark and it's trading the second lowest it's ever been up until literally yesterday and so I think BHP saw here's a company similar to us a little bit smaller you know a lot smaller but it's got great assets that would be synergistic with ours and.

We're not going to get a chance to get it much cheaper cheaper and people forget how well Ango performed from inception right up until 20110 from 1960 to 2010 anglos beat the SNP by 400% by four times you know had you invested in 6061 rote out the Cycles you you did.

Amazingly well it was a leviathon you know when I went there in 1980 81 people were see seriously worried about anglo's cornering the world mining Market I went to the the Northwest mining conference after graduation that was in October November 1981 two months before I got on the plane to come here and boy anglos was the talk gold was coming down from.

800 it was still around 600 maybe 550 and um anglos was explaining how they were drilling 3 four kilometers deep to pick up the carbon lader Reef that was maybe one or two inches thick and hell monco at that time was the largest investor in the United States and manoro was just the overseas arm of angle so that's where it was and it's not just.

History anglos has always good had good assets and whether you want the ones in South Africa or not is there relevant their overseas assets on the whole are very good so what is is the rational response from an Anglo shareholder today to BHB bulletin's offer that pretty much everybody is saying is just an opening bid Alec I haven't spoken with the.

Government on this yet but I have a hunch this is one of the few times Peter major the South African government and the trade unions are probably perfectly aligned we don't want anglos to disappear it's a fantastic portfolio investment as was De Beer all of us had deers and anglos in our portfolios and sometimes you wanted to.

Have over waiting and sometimes you wanted to have under waiting but to me the Perfect Analogy here is the average fund manager is like a kid with an axe and he's chasing a Golden Goose he knows it's gonna lay an egg every day but he wants to get two eggs so he can beat everybody else today he'll worry about tomorrow when tomorrow.

Arrives and so your average fund manager and definitely your average Trader they could give us stuff they'll sell anglos today for the highest bidder just like they did to beers fully realizing they will never see it again it's gone forever and I fought as hard as anybody when the beers wanted to delist to keep it on board and we can.

Look at some of our trusted fund managers who sold the Family Jewels for what a quick buck and you can start with old Mutual and I name a few others and who did that really benefit sure we made a couple extra bucks that day and the next day De Beers was gone forever and I the same thing is going to happen with anglos if the.

Shareholders agree to it but I don't think the majority of shareholders are going to agree to a takeout and I certainly don't think the big holders like the IDC the pic and I'm hoping there's a couple large fund managers out there that see further than the end of the day what can the South African government do to block this though we've.

Already heard uh well read in the financial times that gy mantasha said BHP is didn't do well by us with the buletin deal um they we certainly don't feel very warm and fuzzy towards them so as a South African government BHP is on the wrong side to begin with but what can the South African government if anything do to.

Block a deal like this given that Anga is listed in lond well that that's the big difference Alec this isn't a case of Walmart coming into South Africa and taking over um macro where government just laid down rule after rule condition after condition term after term this is an overseas company that has a couple Assets in.

South Africa and what's going to stop you saw BHP they said our bid is based on anglos selling or unbundling their South African Assets Now we saw that with tuella right that was Anglo americ unbundling its coal assets there's no law against that in fact I think it made a lot of people.

Rich but there's a reason you've got mining houses Commodities are volatile Ernest Oppenheimer figured that out before I should say he figured it out where his roads did had Cecil rhs lived a little longer he would have figured out I got to put something else in with De Beers to counterbalance it out and and Rh actually was a a founder.

Of Consolidated goldfields so he was working in that direction when he died at age 49 Ernest Oppenheimer spent his life in diamonds up until 1917 well it was 1915 when he got chased out of kimbery he was mayor the largest employer and they started accusing him of being a German and he got chased out almost got killed ran to Cape Town was.

Waiting for a boat he was heading back to England but his brother said wait before you go come up to Johannesburg maybe we got to look at gold so up Oppenheimer started with gold but he saw that without roads the diamonds weren't being managed properly he took them on and he no sooner had diamonds he said I've got to balance this portfolio more.

I've got to get copper and so these individual companies Kumba amplats tongela they're eventually going to wish they were in a mining house they're probably eventually going to be in a mining house if they want to live and that is from a South African perspective the the great mining house is Anglo American uh it still is very deeply.

Invested here I was looking through some of the data 50% of the of the assets are in southern Africa and if BHB buletin wants to come in and almost cherry pick the other assets the non-south African assets and then leave the rest here where does that leave the country where does that leave angla shareholders it's up to Anglo shareholders what they want.

To do they want to take this um how can government prevent it look this government's got a hell of a lot of power you know this is a more centralize the government in the previous regime 30 years ago U the pic can go in there and they can buy up shares because their vote counts the.

IDC um they could do it in Alliance with a few big institutions now if our government had good relations with overseas investors they could have talks with them saying let's do something about this but I don't know that our government has very good relationships with overseas investors I think it's the opposite Alec.

I think they've gone out of their way to I don't want to say the word piss off Foreign investors but as people y says yeah that's what they've done and see now now they need foreign investors you know now they need to be on good terms with some some large Merchant Banks and and that's that's how companies grow that's how anglo-american.

Grew they were on good terms with everybody the Swiss the Germans the French that's where all that money came in to build these gold mines I think our government's slowly learning that not fast enough they need allies here if they want to preserve what was a pure South African company that built this country like nobody else nothing else um.

Employed a million people and those were good real jobs with perks benefits Blue Sky Futures so government must look in the mirror and see what they've just about completely destroyed and say is it worth us trying to save it it'll never be what it was with what we've left but we we can preserve it and make it better than it is now well at least gy manasa's.

Immediate reaction was one of we don't want this deal to happen so so that it's a starting point but I'm I'm reminded here about what the Australians did to Wilson Bailey Homes South African Construction Company Wilson Bailey had about 50% of its assets of its revenues being generated in Australia by its Australian construction arm and it's Rel.

Here because BHP buletin of course is the big Australian based in in Melbourne and the Australian government refused to allow Wilson Bailey to sell its construction company to the Chinese had it done so Wilson Bailey shareholders would have been Rich everyone would have been happy but that business that large business went bankrupt as a consequence.

Of it not being able to be sold to the Chinese now we have a situation here in South Africa where an Australian company is effectively raiding a South African uh National Jewel in many ways it's it's been around for so long and our government should be should just stand by and let it happen surely what's good for the goose and you mentioned the.

Golden Goose to begin with is good for the Ganda well government's job is to protect the national interest to do what's in the population best interests and I know they haven't done much of that in 30 years that I could see but it's never too late to start and and there's a lot they can do they can't as we said.

Earlier they can't pull what they did on Walmart coming in to um take over macro you know and just load it with more and more conditions but they they can appeal to the the shareholders that that they currently are responsible for the pic the IDC um few other government peristal the unions you know National Union of mine worker their pension fund.

And they can still talk to parties overseas or large holders and say do you really want to see this disappear because it's a very unique asset what it doesn't do unfortunately anym Alik is grow local Industries when I went to the Anglo 100y year anniversary seven years ago you know huge large tent at F Lake wine farm there must have been 40 tables.

There each table had at least two maybe three head of Anglo companies You Know M I can't even remember the ones at my table you know I think two out of the three at my table I didn't even know and all those people all those CEOs were were battle Harden veterans that were topnotch managers you know good Financial.

CA good um legal background good mining background and that's what anglo-american did and and Nicki opy gave a very nice very short speech he could have gone longer to say our job here was to build businesses we started out building mines and we ended up building more than mines and boy did they and why would any government want.

To tamper with a company like that you know what an engine for the country it was and unfortunately angos hasn't been doing that that's why a lot of the reasons it's smaller has been unbundling all those children that it raised and they grew up and they matured and did well but the other reason is they stopped growing you know they've closed.

Many more mines here than they've opened and that's not the Ango that we knew that's not the Ango That Grew this country and raised its living standards for everybody it seems almost like a greeka tragedy all of this because these South African geography still has as we've discussed many times in the past fantastic minerals under the ground but.

They aren't being exploited because the laws that regulate them and the processes are just not incentivizing anyone to exploit it particularly not your your big South African being anglo-american so if you could if you could advise the South African government on how to earn this around how to get back to a having a champion.

That employs a million people in the country how would you do that geez it's easy Alec you know many times Am Co applied to the government to get a a power generation license so that they could burn their Duff so they could burn their tailings downs that were full of the fines that that couldn't be transported can you imagine that.

Government giv them the go ahead build your own Coal fire power plant using the latest technology the clean efficient technology you know Raz your boiler efficiency can you imagine if Government had let the iron or Consortium not just Ango the iron Ora Consortium and manganese Consortium take over the Sana railroads that you know that's what.

Riotinto BHP and valet have done and look what they do to the port and the railroad you know they they doubled and they triple their iron or production all that money comes in the country and let the coal producers take over the Richard Bay line not just the port but the line as well you know this government doesn't have to do anything except take their.

Hands off the wheel because what they're doing they got a death grip on the wheel and they've cranked it to the left and that's going over the edge if they would just take their hands off the wheel and let the the wheels go straight again these aren't big things and and yes throw out the mprda because there there's no other country that has.

Anything like it and there's no other country that likes it it because it's illogical it doesn't make economic sense it doesn't make ethical sense it doesn't make moral sense and what I say there's four or five big things hell we'll be up to nine or 10 percent growth like Rob Hof says by the end of the first 12 months what is the mprda for those who.

Don't know oh that's the minerals resource and petroleum act and hey I'm glad you brought that up Ali because it was leaked out by the infamous Trevor Manuel in 2002 around June just as I was going on holiday it was leaked out and our mining index fell 35% because what did it say we're going to nationalize the mines less than 10.

Years after Mandela got on the the parliament steps to say we will not nationalize the mines they did it about face and they nationalized mines but Trevor said hey this was only a discussion document but two years later to the day the real document came out and it was just like the discussion document okay that time I think anglos.

Only fell about 25% and it took it two years to get back up and that was in a raging bull market so that's what the mprda did to this country foreigners could see hell they're nationalizing assets they're throwing in a Thing Called be it is uninvestable no matter how high the Raging metal prices go and that's 20 years ago and here we have the.

Consequence so from your perspective Peter anglo-americans should not be allowed to be bought by a BHB buletin it should be turned around the government can do it simply by taking its hands its death grip as you call it off the wheel and it will benefit and grow and address many of the issues that the South African economy is facing at the moment.

Am I am I summarizing it well yeah very good I'd like to see gwy and sirel get on the podium together and appeal to all shareholders please don't accept the bid we are going to make this place investable again we're going to get off the shackles the horrible legislation that prevents people from investing here we're going to encourage foreign.

Investment something we haven't had for 20 years and and that would give people reason hey let's hang on to the anglos because it can go that thing will go from 600 to 800 to a th000 if you get the shackles off of it and if you don't do it the Australians will be owning this asset so yeah they'll up.

That take out two golden eggs and the goose is gone forever and you you can put BHP in your portfolio and that's it Peter major is our man on mining uh your company is called mergence Peter modern corporate Solutions we had to have a always get that one wrong so let me get that right to bring us up with the times H from mergence to Modern from mergence.

To modern modern corporate Solutions uh he's busy all over the world but arily in Cape Town now he's in in Idaho where in Idaho Pete Kellogg Idaho home of the richest deepest Silver Mines okay looking after silver there hopefully you're going to be doing a lot more work in South Africa if gedy and sirel just listen just take the cotton wool out of.

Their ears put it in their mouths and don't let this National Asset disappear that's the message from Peter major and I'm Alec hog from bus.com

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