Anglo-BHP deal may lead to multibillion-rand exodus, JPMorgan says

The proposed takeover of Anglo American by larger rival BHP, if consummated, may result in a capital outflow of about R80bn from SA, number crunchers at JPMorgan said, a move that might give the Reserve Bank a fresh headache as it has the potential to weaken the rand.

If Anglo agrees, the proposed $49bn tie-up could lead to the spin-off of Anglo’s iron ore and platinum assets to shareholders. The distribution, according to JPMorgan’s note to clients dated May 23, is expected to prompt developed-market investor index funds to sell the unbundled stocks, potentially leading to a significant outflow of funds. ..

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