Ghana Govt issues statement of AGC

The Government of Ghana issued its first major statement on the ongoing liquidity problems at Ashanti Goldfields Limited in which the govt has a 20 percent holding plus a golden share that allows it to block ant merger.

A statement signed by Mr John Mahama, Minister of Communications, said the objectives of the government's strategy are to "ensure the long-term financial strength of Ashanti Goldfileds Company Limited, maximise shareholders' value and protect the national interest and interest of all parties concerned".

The statement reiterated Government's "request to counterparties and lenders to the Company for an extension of the period of the standstill agreement by the Hedge Book counterparties". However in the British press reported morning that the 17 intermediation banks have only granted a 72- hour extension to the deadline which was due to expire at 17:30 on Monday, October 18, 1999.

If granted the one month extension, the "? the Government will undertake a detailed review of all the available options in order to support and strengthen Ashanti Goldfields Company Limited. In the interest of all parties concerned, the review shall include but will not be limited to the following:

* Detailed discussions with Lonmin as principal shareholder of Ashanti. Discussion with other large shareholders of Ashanti.

*Detailed discussions with other potential investors in Ashanti who have already made expressions of interest.

*Continued discussions with Hedge Book counterparties and creditors of Ashanti.

*Review alongside Ashanti's management to address its current liquidity situation with a view to attaining a long-term solution".

The statement said "in view of the expressions of support that the Government has received from potential investors since the beginning of this crisis, Government anticipates a resolution of the current situation within the one month extension period of the standstill agreement".

Lonmin revealed its decision just hours before Ashanti's 17 banks granted a 72-hour extension to the moratorium that appears to be keeping the company afloat.