Silk Road Fund eyes up Glencore’s Kazakh mine in Chinese gold rush

Glencore's Vasilkovskoye mineChina’s state-backed $40bn Silk Road Fund has teamed up with the China National Gold Group Corporation to explore the possibility of putting an offer in for Glencore‘s Vasilkovskoye mine, according to reports in China Daily last week. The sale could pocket Glencore around $2bn. 
The idea that Glencore might sell the mine surfaced several months ago amid suggestions that the Anglo–Swiss multinational commodity trading and mining company would seek to capitalise on growing investor appetite for gold assets in its efforts to bring net debt down to below $18bn this year and to $15bn by the end of 2017
Last month, the Silk Road Fund also reported to be discussing making a bid for the mine with the Shandong Gold Mining Company and the Zijin Mining Group Company.
So far this year, China has spent around $9.6bn buying up mines around the world on the back of a 36% year-on-year increase in commodity prices.
“Chinese miners are competing to secure gold assets, because there’s a consensus that domestic demand will far outstrip local supply due to fast-growing investment demand,” Wang Rong, an analyst at Guotai Junan Futures Co., told China Daily in a phone interview on Thursday. “The valuation of gold assets might still have potential to rise given the bullish outlook in the bullion market now.”
The talks come after China Molybdenum Co. announced in May that it has agreed to buy a controlling stake in Freeport-McMoRan Inc.’s copper mine in the Democratic Republic of Congo for $2.65bn, following a $1.5bn deal in April for Anglo-American Plc.’s niobium and phosphate business.
China National Gold also said in April that it had plans to purchase Eldorado Gold Corp.’s Jinfeng gold mine in Guizhou Province for $300 million.

Source: yibada