Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Randgold Resources led gold miners on the markets, gaining 9.16% to $88.90 a share on the NASDAQ, after announcing a political settlement in Mali.
“Randgold Resources today welcomed the announcement of a political settlement brokered in Mali by its West African neighbours and said the disruptions which followed last month’s military coup had not materially affected its gold production in that country,” wrote the company in a news release.
“Over the weekend the military junta announced that it had agreed to reinstate the constitution, in terms of which the president of the national assembly will act as head of state and oversee the appointment of an interim prime minister to manage the country’s return to democratic rule. As part of the settlement agreement, president Amadou Toumani Toure has formally resigned as head of state.”
Since news of the coup, Randgold has lost 20% of its market capitalization. John Paulson, who have accummulated a heavy stake in the company, lost GBP8 million since news of the coup broke.
Other miners affected by developments in Mali include Iamgold, Avion Gold and Cluff Gold.
