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

To: Bucky Katt who wrote (4640)	12/22/1997 7:25:00 PM
From: goldsnow	Read Replies (1) \| Respond to of 116815

I would for a sake of good argument would argue an opposite. South Africa already moved-up 25% from it's low in many cases, and concern that HM undoubtedly had that Australian Co would follow shortly William, if you and I started to smell bottom, surely gold mining people smell it too. on top of it HM understands that Australian shareholders would unload their shares on open market at half-price (who you think would get bulk of it at A$ 2-3, and did you check Plutonic options available to management. Now sharholders are stunned with electric gun and happy to get cash rather than HM shares, which are ovepriced in comparison to many at POG 290, but underpriced if POG will go to $350. I say HM made albeit possibly premature, but what may turn-out bottom-price move. (recall what Barrick paid for Arreguippa few years back) As for you and me few more bold moves like that and shorts start to run for cover or hedge buying mining shares Homestake acquisition may spur more gold mergers 03:44 p.m Dec 22, 1997 Eastern By Scott Anderson TORONTO, Dec 22 (Reuters) - Homestake Mining Co.'s (HM.N) $640 million acquisition of a large Australian gold producer could set off a flurry of consolidation among gold miners, buffeted by weak gold prices and sagging stock prices. San Francisco-based Homestake said on Monday it would acquire Australian producer Plutonic Resources Ltd. (PLU.AX), doubling Homestake's Australian output next year. The deal would make Homestake the third largest gold producer in North America, based on annual output, after Denver-based Newmont Mining Corp. (NEM.N) and Canada's Barrick Gold Corp. (ABX.TO). Analysts said many producers were becoming attractive takeover targets following a decline in the world bullion price to 18-year lows and a slump in gold stocks. Last week, Toronto-based Barrick adopted a shareholder rights plan, effectively giving it a poison pill defense against any takeover offer, even though the company said the plan was not a response to any specific takeover proposal. Gold mining takeover speculation fueled a rally on the Toronto Stock Exchange on Monday, where the influential gold and precious minerals subindex was up almost 2 percent in late trading. ''This could be a little bit of spillover activity (from the Homestake deal), with people thinking there's more mergers coming,'' said Mike Curran, a senior gold analyst at brokerageMidland Walwyn. ''I definitely expect more mergers in the next few months,'' said Curran, who had been predicting a spate of mergers and acquisitions in the gold sector over the past nine months. Merrill Lynch gold mining analyst David Christensen also anticipates increased merger activity in coming months as low gold prices make companies vulnerable. He said lower prices were forcing producers to review their asset values and noted that major North American gold producers took about $1.3 billion in writedowns in the third quarter, with more anticipated next year. ''Several North American gold producers remain financially weak and we could witness additional corporate failures if gold prices persist at the current depressed levels,'' he said. ''Corporate rationalizations and consolidation could become a major theme during 1998 as the industry looks for ways to improve profitability,'' added Christensen. Deacon Capital Corp. analyst Catherine Cignac noted that specific assets could be more attractive to potential suitors than overall companies.''Any company with financial troubles could put up saleable mines,'' she said. Echo Bay Mines Ltd.'s (ECO.TO) Round Mountain property in Nevada could be among assets put on the block next year, said Cignac. ^REUTERS@