London - British investors yesterday reacted enthusiastically to the prospect of Anglo American joining the FTSE-100, as financiers predicted another spate of restructuring and disposals would follow the UK listing.
While Anglo has no plans to raise new capital - and consequently no pressing need for a principal listing in London - analysts suggested the move would give it the "freedom to delist, unbundle and sell" the entire industrial interests of Anglo American Industrial Corporation.
Analysts expect Amgold, whose principal interest is Anglogold, and Anamint, which holds about 15 percent of De Beers, to be unbundled. Chemicals group AECI, beverages group Bevcon, and Mondi, the diversified pulp and paper group, are among those earmarked for disposal.
This would position Anglo as a direct rival to Rio Tinto, which dominates the extractive industries sector of the London Stock Exchange. Analysts hope its presence may rejuvenate a sector that has fallen to a 25-year low after the collapse in metal prices and the gradual deterioration of Lonrho's share price.
The move is a fillip for De Beers, Anglo's sister company, which was widely seen in London as the most immediate beneficiary of the new structure. The plans announced yesterday by Anglo will increase De Beers' exposure to hard currency earnings and enable the group to sell down its non-mining interests. De Beers will hold 40 percent of the new Anglo American.
In contrast to Billiton, which last year raised #1 billion in London, Anglo does not intend to place new shares when it lists in March. Although Billiton's share price had been hit by the slump in metal prices and share disposals by South African institutions, analysts predicted demand from tracker funds - which buy across the FTSE-100 - would support Anglo shares.
Analysts suggested the move could also pre-empt a London listing by brewer South African Breweries (SAB). A deal between Anglo and the Liberty Life group could also lead to the disposal of both companies' stakes in SAB, which are now held through Bevcon, to a European brewery.
Speculation this year has cited both Heineken and Guinness as potential merger partners for SAB.