Takeover Rumours, page-3

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NEW YORK -- A prominent American investment bank has assembled a team of "rocket scientists" in Australia to assess options for a senior gold producer, thought to be Barrick Gold [ABX], to acquire Newcrest Mining [NCM] and the gold division of Sons of Gwalia [SGW] in one fell swoop.
A well placed source said formal preparations have been underway for at least three weeks and have taken on added urgency to pre-empt Newcrest funding its revival of the Telfer gold project on unfavourable terms.

The report was confirmed independently although it has not been confirmed that Barrick is the originator. AngloGold [AU] has been regularly linked to Newcrest as a consolation prize after losing Normandy to Newmont [NEM] in a bitter bidding war that ended in February this year.

Investment professionals consulted by Miningweb said such a deal was "logical" although the consensus was that it would be a tough sell to shareholders of Barrick because of out of the money hedge books and weak production profiles, particularly for Sons of Gwalia. "They will get praised for the ounces and murdered for the hedges," was the snap assessment of a Canadian analyst.

If the deal proceeds and assuming Placer Dome [PDG] closes its bid for AurionGold [AOR], every major Australian gold mine will be in the hands of Americans, Canadians and South Africans.

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