media article

http://www.theaustralian.com.au/bus...167412638?nk=0d763400071441b5e417832a87882ff9


THE exchange rate-inspired rally in the local gold price to 10-month highs has prompted nickel producer Panoramic Resources to get ready to test the market’s appetite for a deal on its Gidgee and Mount Henry gold projects in Western Australia.
The two projects have a combined resource base of more than 2.5 million ounces of gold and were acquired as part of Panoramic’s diversification drive in 2011-2012, at a cost to the company of $50 million in cash and shares.
But poor sentiment towards gold projects as a result of weakness in US dollar gold prices has seen Panoramic hold fire on moving on the $300m development of the two projects (Mount Henry is 70 per cent-owned) pending a recovery in gold prices, now under way in Australian dollar terms because of the plunge in the exchange rate.
Panoramic managing director Peter Harold said the company was set to test the market’s appetite for the gold assets in the first quarter of next year. Little if any value for the gold assets is reflected in Panoramic’s market capitalisation.
“We have put together an information memorandum, and we will probably run a trade sale and initial public offering in a parallel process,’’ Mr Harold said.
“If we get an attractive enough proposal for a trade sale then we can marry that up against an IPO, which is probably more risky but potentially a better outcome for our shareholders. If the market is not right, we can hang on to them and keep optimising the assets.