Ghana to keep golden hold on Ashanti

The Ghanaian government has said it has no immediate plans to shed the 'golden share' that gives it control over the ownership of Ashanti Goldfields.

But officials suggested the government would be willing to do so if the goldminer persuaded Ghanaians it was necessary.

Ghanaians have tended to think of Ashanti as a national heirloom and the golden share as the last defence against a feared, foreign takeover.

The golden share allows the government to intervene in the corporate decisions of what was once one of the world's largest goldmining companies. Ashanti officials argue that the state's reluctance to let go of the golden share has contributed to depressing its share price and prevented it from taking part in industry consolidation.

The government has a 19 per cent stake plus the golden share in Ashanti, which was floated in 1994. Lonmin, the platinum-focused miner, has 32 per cent.

When John Kufuor was elected as the country's president a year ago - pledging to usher in a "golden age of business" - the company hoped his government would be more sympathetic to its view.

"We are not going to fight Ashanti on this, but it is up to the company to lay the groundwork by persuading public opinion that we need to get rid of it [the golden share]," said Jacque Obetsebi-Lamptey, information minister. "Meanwhile, we are not going to use the golden share to intervene in the way the business is run."

Ashanti officials said they could not comment on the impact further delays in resolving the issue could have on the company's efforts to refinance $219m of convertible bonds. Ashanti's cash position is not strong enough to withstand the level of cash redemptions that would be likely if its share price fails to recover by 2003, when the bonds mature.

In a bid to repair its balance sheet, the company has reached conditional agreement with creditors to extend the maturity of the bonds by five years. But one of the conditions is that the government lets go of the golden share.

A close adviser said Mr Kufuor's instinct was to relinquish the golden share. But he was concerned that opponents could use the move to whip up hostility to his government.

The population has been hard hit by austerity measures taken to restore fiscal discipline after a prolonged slump in the price of Ghana's main commodity exports and a wave of mismanagement under Jerry Rawlings, the former president.