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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: baystock who wrote (71401)	6/9/2001 3:00:37 PM
From: goldsheet	Read Replies (1) \| Respond to of 116769

<<JP Morgan was the banker that administered Harmony's $150 million (R1.2 billion) five-year, unsecured corporate bond The cost to the company is estimated at about 13.4 per cent. >> Looks like they are going to be paying about $US20M in annual interest, over $US100m over five years. They could have obtained a gold loan at about 1%, if they were willing to put up about 545,000 ounces as collateral. This is nothing for a firm producing 2moz per year, or about 10moz over the 5 year loan period (about 5% of production would support the loan) One can only hope they sell the 545,000 ounces over the next 5 years for $US250M (principal and interest), which works out to an average price of $US450/ounce. I would have sold the ounces and gave up the potential appreciation, instead of floating bonds at such high interest rates.