Harmony raises R8.5 billion as gold retreats from record
Harmony Gold is raising R8.5 billion from investors after its shares surged almost sevenfold in five years, even as the gold price retreats from January’s record high.
Harmony Gold, South Africa's leading gold producer, has announced a plan to raise R8.5 billion through the issuance of bonds. The company, which has experienced significant growth over the past five years, aims to bolster its financial position during a period when gold prices have retreated from record highs. With the current price of gold at $4,337 an ounce, the metal is trading at almost twice its inflation-adjusted level from the 1980s, when it reached a peak of $678 an ounce in January 1980.
Investors in the bonds can expect to earn interest payments ranging from 1.5% to 2% per year between now and September 2031. Additionally, they have the option to convert their investment into Harmony's shares, currently valued at R314.26 each. The bonds are targeted towards large investors and are anticipated to be listed on the Frankfurt Stock Exchange's Open Market.
Harmony Gold, founded in 1950 and headquartered in Johannesburg, operates in both South Africa and Papua New Guinea. The company has a diversified portfolio, comprising nine underground mines, one open-pit mine, and several surface operations. CEO Beyers Nel expressed confidence in the company's ability to continue generating long-term value for shareholders.
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