London’s streets no longer paved with gold as miners struggle by Thomas Biesheuvel(Bloomberg News – December 23, 2018)

[LONDON] Reports that AngloGold Ashanti is considering a London listing provide some festive cheer to a city that’s lost its way as a home for gold miners.

While Toronto, Johannesburg and Sydney have long hosted the biggest producers, London vies with New York as the world’s premier gold trading hub and its financiers have bankrolled the industry since the development of South Africa’s giant gold fields more than 130 years ago. When junior gold miners flocked to the city in the early 2000s, a renaissance seemed at hand.

That promise hasn’t been realised as companies from Petropavlovsk and Acacia Mining to Centamin struggled to reach their potential. Star performer Randgold Resources will exit next year after its acquisition by Barrick Gold, capping a slump in the market value of London-listed gold and silver miners. That’s left fund managers struggling to find liquid gold stocks as the bullion price languishes.

“There has been a lot of value destruction in the sector,” said James Bell, an analyst at RBC Capital Markets in London. “Investors are saying: “not only do I have no conviction on where the gold price is going, but also these companies are fundamentally high risk.””

When Randgold delists, the combined market value of London’s gold and silver miners will drop to less than half the £30 billion ($38 billion) of six years ago.

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