Iron Tablets For Black Hairs

The rise in gold prices unleashed a wave of mergers in the mining

Carolyn Cui , Liam Pleven and Ray Give them

The Wall Street Journal

09/05/1910

Gold prices are approaching a new peak, which has unleashed a wave of agreements featuring mining billionaires have decided to redouble its commitment to the yellow metal.

The rise in metal prices is driven by demand from investors, who bought more than half of all gold sold in the second quarter, the second time that happened since 1979, analysts said. Typically, most gold is purchased for jewelry and other uses.

The big gold miners seeking to meet this demand by digesting rivals. On Friday, Goldcorp Inc. announced the purchase of Andean Resources Ltd. for U.S. $ 3,400 million. Just a month before, Kinross Gold Corp. agreed to pay U.S. $ 7,100 million for Red Back Mining Inc.

In August, gold futures prices rose 5.6% while investments totaled 20.2 tonnes to reserves of over U.S. $ 52,000 million SPDR Gold Shares, the largest gold exchange-traded fund that specializes in the world. In July, however, investors liquidated 38.2 tons of background and prices fell 5.1%.

On Friday, prices fell 0.2% in New York to settle at U.S. $ 1,249.20 per troy ounce and are only 0.6% below the record high of U.S. $ 1,257.20 recorded on 18 June. Accumulate gold price up 14% so far this year.

Catastrophe Insurance

Traditionally, investors have had a role in the demand for gold metal, which has been driven by the needs of jewelers, dentists and electronics manufacturers.

In 1998, when the World Gold Council, the body that brings together industry, began breakdown of demand by investors separately, they represented 6.9% of demand. In 2009, a turbulent year for the economy and finance, the figure rose to 39%. In the second quarter of this year, however, investors accounted for 51% of demand, a proportion that was only surpassed by 60% in the first quarter of 2009, when the stock market was at its lowest point.

Now, investors will comfortably exceed any other source of demand, such as jewelry. Investors have seen the yellow metal as a haven from the crisis of sovereign debt in Europe and in the past weeks, compared to fears that the U.S. economy back into recession.

"Gold provides protection against a multitude of threats," said Kevin Norrish, director of commodity research executive of Barclays Capital. The interest, he says, reflects "a lack of confidence of some investors on governments and their ability to solve its structural problems."

At the same time, the growing dominance of the investors in the gold market also means that the prices of bullion and the shares of gold companies are exposed to the same risk: that improved macroeconomic diagnosis that investors do change their minds and sell large quantities of gold.

jewelry owners take longer to sell because they have an emotional bond with the metal, said John Stephenson, portfolio manager at First Asset Investment Management.

Goldcorp's offer for Andean Resources passed a proposal for Eldorado Gold Corp. is the latest in a series of mergers that reflects the desire of producers to gain access to resources.

a particularly tempting target for mining are smaller companies devoted exclusively to exploration, such as Andean Resources, with a proven ability to find new veins of gold. The main asset that attracted the interest of

Goldcorp was the Black Mountain project in Argentina. Andean announced in July that could produce 285,000 ounces of gold per year within five years of operation, from 2012.

Chuck Jeannes, Goldcorp's chief executive, called it "a truly exceptional asset" on Friday in a conference call with investors. He added that this kind of findings "are becoming less common."

The agreement provides that each share of Andean shares will be exchanged for 0.14 Goldcorp or $ 6.50 Canadian, about $ 6.25, up to a maximum of 1,000 million Canadian currency cash . The offer represents a 35% premium over Thursday's closing price of the shares of Andean on the Toronto Stock Exchange.

The transaction was approved unanimously by the boards of both companies, but must have the approval of most Andean shareholders, 21% de los cuales ya le dan dado luz verde.

Eldorado, sin embargo, aún no se da por vencida y dijo el viernes que llevará su oferta, de 6,36 dólares canadienses la acción, directamente a los accionistas.