It seems Anglo Platinum's cash-strapped 79%-parent, the UK-listed Anglo American Plc, has arrived at its offspring's house intent on mooching as much cash as it can.
For a minority shareholder concerned that Anglo American isn't above muscling its 79%-owned platinum arm into providing an old-age pension, AngloPlat's accounts make disconcerting reading.
Since January 2008, Anglo American has sucked R1,9bn from AngloPlat in "related party" deals. This includes a R1,5bn bill for the "purchase of goods and services" from Anglo American - a steep 171% jump from the previous year.
But there is also the R155m in interest paid to Anglo American for a R4,3bn "loan facility" under terms which the UK-listed miner refuses to disclose.
Thirdly, in January AngloPlat agreed to pay US$22,5m to Anglo American for assets in Zimbabwe, including the Unki mine. But the circumstances of this related-party deal remain murky.
Though the sharp increase in related-party deals was raised at last week's AngloPlat AGM, there were few answers. For a firm that made R14bn in profit last year, R1,9bn seems small change. But it is the trend - and poor disclosure of it - that is alarming.
At last week's AGM, shareholder activist Theo Botha asked if the board was concerned by the increasing amount that AngloPlat was paying to its parent.
On the 171% jump in "shared services deals", AngloPlat CEO Neville Nicolau said "we monitor this quite carefully to ensure that we get value".
These services include payroll, IT and accounting systems. Nicolau says the board looks at whether "it is cheaper to do it through this system than it is to do it ourselves through some third-party vendor".
But these related-party costs aren't just a concern for the likes of uppity minority shareholders. Richard Dunne, an independent non executive director, admitted there was "a lot of heated discussion around that [in Anglo Platinum's audit committee]".
WHAT IT MEANS
 AngloPlat pays 171% more for "services"
Political tensions under Unki deal
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Dunne says independent directors are watching this closely, but in some cases there is a benefit: AngloPlat is saving R5m/year in insurance costs by being bundled- in with Anglo American, for example. "There is constant measurement around what is being charged, versus what value we're getting, versus what we could pay to another, outsourced service provider."
But as five of AngloPlat's 10 non executive directors (which include Cynthia Carroll) have strong links to Anglo, how robust can these discussions really be?
The below-the-radar purchase of Unki and 89% of the mineral rights in Zimbabwe in January is intriguing not just for the price but for the motive.
Unki, located near Gweru on Zimbabwe's Great Dyke, will be a boon for AngloPlat when it begins producing next year. Seen as the last great undeveloped platinum resource outside SA, it aims to produce 150 000 oz/year.
But in March last year, Robert Mugabe's Zimbabwe government strong-armed Anglo Platinum into "releasing" 31% of Unki's mineral rights to his government. These concessions were promptly handed to Central African Mining & Exploration, which then provided a $100m loan to Mugabe's government.
This prompted outrage in the UK, mainly for the fact that Anglo American owned a $400m investment in Zimbabwe in light of economic sanctions against Mugabe. In June, the UK Foreign Office told the Financial Times it would probe Anglo's interest as "we do condemn any action that would appear to support the regime directly".
So why should AngloPlat buy this chunk of Unki now? Was it so that Anglo American could distance itself from Mugabe, if British investors ask?
The answer at the AGM was anything but clear. Chairman Fred Phaswana said the purchase cleaned up the structure, as it was AngloPlat that was actually developing the mine, even if Anglo American actually owned it.
But Nicolau says AngloPlat was "almost paying money outside of Zimbabwe for money that was in Zimbabwe to develop an asset that, in the longer term, would generate value".
Is that such a good deal? And, more importantly, how do you value a mine in Zimbabwe right now?
In response to a question from Botha, one company official said "the valuation was done by Anglo American and checked by Anglo Platinum... based on the ounces associated with the rights".
He added that external advisers were part of that process. But how do shareholders assess the legitimacy of this valuation without any documents?
The disclosure around the R4,3bn loan made last year by Anglo American to AngloPlat is also dismal.
By December 2007, AngloPlat hadn't borrowed a cent from its parent, but by the end of last year, it had used R4,3bn.
Bizarrely - especially given the fact that this is a related-party loan - Anglo isn't revealing the terms of this deal.
At the AGM, Phaswana said the rate was "market-related", but refused to reveal more. "It [Anglo American] worries about disclosing it, because otherwise it is difficult to negotiate around other facilities," he says.
Though Phaswana says this is "more competitive" than Anglo Platinum's 12,5% cost of funding, it is alarming that minority shareholders like Liberty Group (11%) haven't demanded full disclosure.
After all, the signs aren't good that Anglo American is providing the best deal for its scion. Last year, for example, Anglo Platinum placed R1,2bn on deposit with its parent but was paid only R31m in interest. This is interest of barely 2,5%: the platinum miner could pop over the road and put the money in an on-call Absa account and get a better rate.
Taken all together, it seems Anglo American is leaning quite heavily on its progeny. And it's keen to get closer: Anglo owned 66% of AngloPlat in 2002, but by December, it owned 79%.
Not that its reliance on getting cash from its offspring is surprising. A month ago, Anglo cancelled its dividend for the first time since the Nazis invaded Poland - a decision panned by Cynthia Carroll's predecessor, Tony Trahar, in the FM (March 27) as a "great mistake".
On Friday, Anglo confirmed it had priced a $2bn bond issue, all eviating strain on its balance sheet. By year-end, Anglo's debt sat at $11bn - more than double the $5,2bn a year earlier.
So what role does Carroll see for AngloPlat in her company's' bigger plan? Is a buyout of minorities on the cards, given the increase in shareholding?
Phaswana dodged this question, despite the fact that he also sits as a non executive director on Anglo American's board. "I always recuse myself [from Anglo American discussions] whenever we talk about these issues. I don't know what the strategy is. I'm as much in the dark as you are," he says.
At the moment, it seems Anglo's strategy is clear: use its relationship to cushion its own cash crunch.
