Today, 11 February 2013, Sibanye Gold Limited (Sibanye Gold) (JSE, NYSE: SGL) began trading on the JSE as a fully independent, proudly South African gold mining company. Sibanye Gold has been created through the unbundling, by Gold Fields Limited (Gold Fields), of its wholly owned subsidiary, formerly known as GFI Mining South Africa Proprietary Limited (GFIMSA). Sibanye Gold began trading on the JSE at a share price of R13.05 per share, giving it an initial Market Capitalisation of approximately R9.5bn. By 11:30am the share had subsequently traded higher, on substantial volume, to R14.20 per share.
Neal Froneman, CEO of Sibanye Gold, commenting on the early trading, said, “it will take at least a few weeks to establish a representative price and as such we would expect a continuous rerating of the Sibanye Gold share as the market recognises the underlying value of the assets, their cash generative abilities and Sibanye Gold’s stated positioning as a benchmark dividend yield vehicle.”
Sibanye Gold’s operations are located in South Africa with its principal operations being the Kloof, Driefontein and Beatrix mines. Despite already long and illustrious operating histories, the assets still have some of the highest grades and largest resources in the South African gold mining industry. Sibanye Gold will be one of the largest gold producers in South Africa and amongst the top ten largest gold producers globally.
As a fully independent, unhedged gold company, Sibanye Gold will be highly leveraged to the Rand gold price and generate significant cash flows, which it will ring-fence for the benefit of its stakeholders. It is the new management’s primary focus to lower costs, improve operational effectiveness and optimise capital expenditure in order to maximise cash flow and ensure sustainability.
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