Newcrest closes gold hedge book

Newcrest closes gold hedge book
11 September 2007 - Melbourne Australia

By Al Robinson

• Newcrest closes gold hedge book
• Fairfax invests in managed fund business
• Asciano may enter Queensland coal hauling market
• Westpac wary of prolonged credit turmoil
• 62% of businesses to raise prices: survey
• Dry weather crimps grain supply

Overseas Markets

Name	Yesterday's Close	% Change
DJIA	13127.85	0.11
FTSE 100	6134.10	- 0.73
Nikkei 225	15764.97	- 2.27
Shanghai	5355.29	1.46
CSI 300	5377.22	1.53
Gold	712.10	0.37
Crude Oil (BRENT FUTR)	75.48	0.54

Newcrest Mining is bullish on the gold price. The company will raise AU$2 billion in a heavily discounted rights offer to close out its hedged gold positions. Gold moved through US$700 recently; it may move up further as investors migrate out of risky financial assets into real assets with intrinsic value. Fairfax has put more money into managed funds businesses, purchasing fund website InvestSMART for AU$12 million. Logistics company Asciano is looking to provide Queensland Rail with some competition for the Queensland coal transportation market. This would come as welcome relief for coal companies up north, which have been contending with congestion at ports. Westpac boss David Morgan expects interest rates to rise if credit volatility doesn't improve. Dun and Bradstreet revealed the findings of their latest business expectations survey yesterday. Sixty-two percent of businesses are preparing to raise prices in the coming quarter. Meanwhile, grain production is still suffering from the dry spell.

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Newcrest launches $2b entitlement offer
Newcrest Mining (ASX:NCM) is raising AU$2 billion in capital to close out its hedged gold positions. The company hopes to pull in funds from current shareholders through a 7-for-20 renounceable rights offer at AU$17.40 per share. This represents a 29.8% discount to the current share price.

Fairfax buys online funds business
Fairfax (ASX:FXJ) has bought InvestSMART, an internet site specialising in managed funds, for AU$12 million. Fairfax chief executive Jack Matthews said the company was moving to take advantage of high demand for non-advisory wealth management.