Producers rise on higher prices

The ongoing battle for Normandy Mining (ndy-t) took centre stage in eastern markets once again, with American producer Newmont Mining upping the ante at the start of the Jan. 2-8 report period.

Newmont’s latest offer provides A10 more per share than before, along with the original script component of 3.8 shares per 100 Normandy shares. Despite the revision, South African contender AngloGold will not raise its own bid, which is not suprising considering its standing offer values Normandy less than Newmont’s previous bid.

For Normandy, the battle bodes well for its Canadian shares, which rose 75 over the period to bring to 32% the degree to which they have risen since the foray began. Going the opposite way during the period was Franco-Nevada Mining, which fell 65 to $22.90 on a volume of 11.9 million shares, making it the most active issue. Franco will merge with Newmont if that company acquires 50.1% of Normandy beforehand.

As for Canada’s remaining gold majors, all benefitted from an increase in the price of gold:

Barrick Gold rose 93 to $26.38; Placer Dome, $1.11 to $18.51; and Kinross Gold, a nickel to $1.24. The yellow metal was fixed at US$279.35 per oz. in London markets on the morning of Jan. 9 for a gain of $1.25.

Meridian Gold led the mid-tier producers with a jump of 80 to $17.15. Goldcorp rose 60 to $19.90 and Agnico-Eagle Mines climbed 23 to $15.93.

On Jan. 9, Dayton Mining and Pacific Rim Mining became the latest industry consolidators by announcing a 1.76-for-1 merger. The ratio leaves Dayton shareholders with 70% of the resulting company. By presstime, Dayton was up 15 to 45, sparking life in an otherwise cool period; Pacific Rim was down 9 to 30, erasing an 8 gain over the previous seven trading days.

Bolstering base metal producers, nickel jumped 23 to a London morning fix of US$2.88 per lb.; copper climbed 4 to US69 per lb.; zinc rose 2 to US37 per lb.; and lead added a penny. The metals-and-minerals sub-group gained 112.15 points, or 2.7%, to finish at 4,272.26.

Teck Cominco‘s B-series jumped 88 to $13.60 on a volume of 5.3 million shares, making it the largest gainer and heaviest trader among major producers. It was followed by Inco, up 85 to $27.90, Noranda, up 75 to $15.75, and Falconbridge, up 71 to $16.80.

Zinc miner Breakwater Resources rose 13 to 34 as it announced an increase in reserves and resources at its El Mochito and El Toqui mines in Honduras and Chile, respectively. Breakwater had all its mines and projects reviewed by an independent consultant as part of a cost-cutting program.

Among juniors, Globex Mining was the highest percentage gainer, catapulting 500% to 30 on a small volume. The increase for the Quebec-oriented explorer occurred despite a lack of news.