The sexiest mining company in the world – by Warren Dick (Mineweb.com – September 16, 2015)

 

http://www.mineweb.com/

And it’s not just Mila Kunis that’s bringing a sparkle to investors’ eyes.

JOHANNESBURG – So you’re probably thinking the world’s sexiest mining company is a gold company? Heavens, no! (BTW that’s so 1980’s). Is it a diamond company? Mmmm, close. But no cigar. So what is it then? Why, it’s actually a coloured gemstone miner called Gemfields, listed in London.

Gemstones comprise rubies, sapphires and emeralds – amongst many others – and Gemfields has been very good at pulling them out, hand over fist, from its Kagem emerald mine (Zambia) and Montepuez ruby mine (Mozambique).

But to call it just a mining company might be a bit restrictive. “We’re in the business of stimulating both demand for, and supply of, our gemstones,” said CEO Ian Harebottle in an interview with Mineweb recently.

Kieron Hodgson, a commodities analyst with Panmure Gordon & Co in London, agrees that there are parallels with what De Beers has achieved in the diamond industry. “They are very cognisant of the stewardship role they play in the industry, being the largest single producer.

And it’s important they manage the supply of goods in line with demand, as it makes no commercial sense to simply force supply onto buyers when that supply is not being supported by an associated increase in demand, a view that is also being actioned in the diamond industry following recent market oversupply concerns,” says Hodgson.

Evidence of this stewardship role explains why the company’s recent auction in Singapore was the first high quality auction outside of Zambia since 2012.

On the demand side the company has begun building a distinctive brand through the appointment of actress Mila Kunis as brand ambassador, and also through the acquisition of the Faberge’ brand from its largest shareholder, Pallinghurst Resources. Pallinghurst is a Brian Gilbertson creation listed on the Johannesburg Stock Exchange, and also owns assets in manganese and platinum. It retains a 48% interest in Gemfields.

But besides adding the allure of an almost mystical brand through the acquisition of Faberge’, it “brings an intangible benefit to the company that’s certainly not reflected on the balance sheet,” says Hodgson.

For the rest of this article, click here: http://www.mineweb.com/news/diamonds-and-gems/the-sexiest-mining-company-in-the-world-2/

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