Gold miner AngloGold (ANG) on Monday indicated that was still awaiting a response from the government of Ghana regarding the proposed merger between Ashanti Goldfields Company Limited and AngloGold, first announced in May. The government is a substantial shareholder and regulator of Ashanti.

AngloGold understands that the government is awaiting a report from its financial advisors on the proposed merger.

Accordingly, shareholders are advised to continue to exercise caution when dealing in AngloGold's securities until a further announcement is made.

The combined group will be known as AngloGold Ashanti Limited and will trade as Ashanti AngloGold in Ghana.

The combined group will have the largest reserve base of any gold company, a significant and well diversified production base, a highly attractive development and exploration portfolio and the financial and technical resources to maximise organic growth from the existing asset base as well as to capitalise on further acquisition opportunities.

Under the terms of the merger:

--Each holder of an Ashanti ordinary share and each holder of an Ashanti Global Depositary Security (GDS) will be entitled to elect to receive, either: 0.26 AngloGold ordinary shares; or 0.26 AngloGold American Depositary Shares for each Ashanti Share or Ashanti GDS.

In addition, Ashanti Shareholders resident in Ghana will have the option of receiving AngloGold Ghanaian Depositary Shares (GhDS), 100 of which will represent one AngloGold Share, at an exchange ratio of 26 AngloGold GhDSs per Ashanti Share or Ashanti GDS held by any such Ghanaian residents.

On completion of the merger and based on the issued ordinary share capital of each company, existing holders of AngloGold Shares and AngloGold ADSs will own approximately 87% and existing Ashanti Shareholders will own approximately 13% of the combined group.

The board of directors of Ashanti has approved the merger.

Lonmin Plc, which owns 27.6% of Ashanti's issued ordinary share capital, has agreed to support the merger.

The merger is conditional on the receipt of certain approvals and undertakings from the Government of Ghana.

The merger will be effected by means of a scheme of arrangement between Ashanti and its shareholders under Section 231 of the Ghana Companies Code and take account of the required disclosure provisions of the Ghana Stock Exchange.