Pan African raises R850m as gold stages fresh record surge
PAN African Resources said on Monday it had raised R850m in sustainability-linked notes ahead of the repayment of a three-year bond in December.The group is required to repay just under R600m this year representing portions oftwo bonds. The bullet payment comes just as the company reaches $190m in peak funding for its Mintails project which is currently ramping up.“The markets are very favourable at the moment so we thought this was a good opportunity,” said Pan African CFO Marileen Kok in an interview today. The bond also helps improve the robustness of our balance sheet, she added.The capital raise also helps keep Pan African to target the repayment of the Mintails debt within about three years.It comes as the gold price hit a fresh all-time high in dollars and rands.Commenting on the tone of the annual London Bullion Market Association meeting, UBS analyst Joni Teves said: “Market participants in general appear to be increasingly struggling to find convincing arguments on what pushes gold into a bear market from here.”“Could this be a warning sign or is it just a reflection of the current environment? We are more inclined to be in the latter camp,” said Teves who recently upgraded the bank’s forecast to $2,800/oz this year before pushing through $3,000/oz in the course of 2025. Bank of America also forecast $3,000/oz for gold next year.Shares in Pan African Resources are nearly 123% higher this year following an upgrade in production for this year, assisted by Mintails. At 37.75 pence per share, the stock has easily burst through previous target prices set by Berenberg Bank and Peel Hunt (33-35p/share).There are multiple reasons behind the continued increase in the gold price this year including concerns that election success for US presidential candidate Donald Trump could see fiscal recklessness in the form of stimulus measures, tariffs and tax cuts. A deficit of $1.8 trillion for the US in fiscal 2024, the highest of the ex-COVID era, was possible, according to a report by SP Angel, a UK stockbrokerage.Geopolitical tensions elsewhere on the globe and another round of interest rate cutting, specifically by the US Fed are also behind the charge.Central bank purchases have also sustained the gold price this year. During the first half of this year, central bank buying hit a record high of 483 tons, according to the World Gold Council, the industry body.“The fact there have been 30 new record highs for gold this year tells you everything you need to know about the world’s geopolitical situation,” said John Reade, head market strategist at the council last month.The post Pan African raises R850m as gold stages fresh record surge appeared first on Miningmx.Weiter zum vollständigen Artikel bei Mining.com
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