search elliott


  • Google
Share/Bookmark

Enter your email address:

Delivered by FeedBurner

FlagCounter

  • Where From?
    free counters
Related Posts with Thumbnails

« Market is in a Thrust Out of a Running Triangle | Main | September, The Cruelest Month, is About to Bite »

Wednesday, September 15, 2010

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

JT, Michael and Trader123

Bloomberg

AngloGold Raises $1.37 Billion to Cancel Gold Hedges

September 15, 2010, 7:12 AM EDT

By Ron Derby and Alastair Reed

Sept. 15 (Bloomberg) -- AngloGold Ashanti Ltd., Africa’s largest gold producer, will sell shares and convertible bonds and use about $1.37 billion raised to buy itself out of supply accords that stop it benefiting from record prices of the metal.

This will “give us full exposure to the gold price,” Mark Cutifani, chief executive officer of the Johannesburg-based company, said in a statement today.

AngloGold, held 12 percent by hedge-fund firm Paulson & Co., is taking advantage of prices that are rising for a 10th straight year to reduce so-called forward sales agreements at lower levels. Barrick Gold Corp., the world’s largest producer of the metal, spent almost $5 billion last year to cancel such hedges against the risk of prices declining. AngloGold said today it sees a “strong gold price environment” next year.

The metal, which reached a record $1,274.95 an ounce yesterday, was up 16 percent this year at $1,269 by 11:44 a.m. in London. Hedges were cut by 780,000 ounces to 6.75 million ounces in the first quarter, researcher GFMS Ltd. said in June.

AngloGold fell as much as 4.8 percent today, the most in 10 months, and was down 13.21 rand at 318.99 rand by 12:53 p.m. in Johannesburg trading. The company said its hedging contracts were set at an average gold price of less than $450 an ounce.

“Down the road it’s a positive for them,” Peter Davey, mining research chief at London’s Ambrian Capital Plc, said today. Ounces were being sold at “ridiculously cheap prices.”

Over-Allotment

AngloGold, with operations in Ghana, Brazil and Colombia, expects to raise $686 million selling 15.8 million shares at $43.50 an American depositary share, or 308.7 rand an ordinary share. The company will raise the same amount again by selling an equivalent number of convertible bonds, it said.

There’s an over-allotment option to sell a further 2.37 million shares and the same number of bonds, boosting possible proceeds to about $1.58 billion, Chief Financial Officer Srinivasan Venkatakrishnan said today on a conference call.

By June, the value of hedge transactions was almost $2.41 billion, AngloGold said. The company will also use funds from credit facilities and cash on hand to close hedges, it said.

--With assistance from Carli Lourens in Johannesburg. Editors: Tony Barrett, Alastair Reed

© 2010 Bloomberg L.P.

Pat Riley Operator #136

CLF warned two days ago.

Pat Riley Operator #136

AAII bulls 50%. Major sell signal. Ticker Sense reported 60+% bulls earlier in the week. Crude oil getting manhandled in the overnight session. If it closes at this level tomorrow, it will make a bearish flip. Not so good for CVX and XOm to continue to prop up the big caps. Probably a gap down open as the market doesn't let the latecomers in at a good entry. TD upcount at 10; a sign of clear exhaustion. And the TD traders will probably buy the pullbacks thinking the market has started a new bull trend. Plus we had "The Catalyst" earlier in the week.

vipul garg

spx may see some unwinding.

vipul garg

since there is no HS pattern, ideally it shud break the right shoulder low.

Opal Crescendo "77"

Isn't gold a commodity? Has there ever in the history of market prognostication been a worse call than Prechter's on gold?

Yes. Prechter's on equities.

So I am forced to admit that, if history suggests the future, you would be wise to read Prechter and fade him. Really couldn't have done better with any service.

Account Deleted

S&P 500 Futures before opening bell

rick

With the price of gold going up so much, one wanders what to do? I must admit I am a bit lost and will keep my savings in cash for the next few months.

fdfd

maybe copper is pricing in hyperinflationary fears?

The comments to this entry are closed.