Africa's Top 100 Gold stocks: The search for the next Red Back is on
The huge premium built into the USD 7.1bn takeover of Red Back unleashes an African treasure hunt.
Author: Barry Sergeant
Posted: Friday , 27 Aug 2010
JOHANNESBURG - -
In a recent interview, Mark Cutifani, CEO of AngloGold Ashanti, noted that his group "can bring a new project on at about $2,500/production ounce, against our major competitors in North America, who are doing the same sort of thing for $4,000/production ounce.
"If you look at the new acquisitions that are being made, this is Kinross's bid [in Canada] for Red Back, and Newcrest's bid [in Australia] for Lihir; they're buying gold at around $7,000/ production ounce".
Indeed. All the names mentioned so far are global Tier I gold stocks, with the exception of Red Back, a Toronto-listed African miner, which currently carries a market value of just over USD 7bn. Applying the metric referred to by AngloGold Ashanti, Kinross and Newcrest are paying premiums of more than 100% for their latest acquisitions.
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