TORONTO (Reuters) – Barrick Gold Corp will make a bigger push to attract institutional investors in China under a new deeper-ties pact with Shandong Gold, aimed at bolstering its shareholder base, executives told Reuters.
Bruised by a strong U.S. dollar, the price of gold is nearing a one-year low, with speculators holding record short positions. China, the world’s largest producer and consumer of gold, is a largely untapped investor source for western miners, said Barrick’s China President Woo Lee.
“We’re establishing relationships with some of these large investors in China – that’s something that we haven’t had before,” Lee said in an interview. “Because Shandong knows the market far better than we do, they are potentially a good source of introductions to the best investors.”
Barrick hopes the addition of long-term Chinese investors will boost the demand and value of its stock which has sunk about 31 percent over the past year, underperforming the S&P/TSX Global Gold Index, which has dropped 6.5 percent, and a 3.5 percent drop in spot gold prices.
Shares shed 10 percent over the last seven sessions alone, as Barrick reported a money-losing quarter, production declines and its president’s departure without a named successor.