People sit up and take notice when billionaires buy gold in vast quantities.
In Russia, for example, eight of the countries 10 wealthiest men have snapped up gold bullion mines like there is no tomorrow.
Billionaire Roman Abramovich, Russia's wealthiest man, will pay $400-million for a 40-per-cent stake in Highland Gold Mining Ltd., Russia's fourth-largest bullion producer. The sudden active attention of Russia's billionaires on gold comes just as the metal hit a 28-year-high in November and is now hovering around the 800 US dollars an ounce mark.
"Clearly these people have the financial wherewithal to invest wherever they want, so it speaks positively about gold," said Don Whalen, the executive chairman of Toronto's High River Gold Mines Ltd., which operates in Russia.
Other oligarchs (pronounced ollie'garks. A member of a small governing faction - The Russian oligarchs are business entrepreneurs who started under Gorbachev during his period of market liberalization ) with gold assets include Vladimir Potanin and Mikhail Prokhorov, who control Russia's largest producer OAO Polyus Gold; Suleiman Kerimov, who owns OAO Polymetal, Russia's third-largest producer; and Mikhail Fridman, an oil and banking magnate who set up a gold mining arm this year.
Oleg Deripaska, whose Basic Element also owns gold companies in Mongolia, in a recent interview with The Globe and Mail, indicated he would like to invest in more gold projects, perhaps with the help of a Canadian company.
And now this week, OAO Severstal, the Russian steel maker owned and run by billionaire Alexei Mordashov, stated that most of London's Celtic Resources Holdings PLC shareholders, which has gold projects in Kazakhstan, has tendered to a $328-million (U.S.) takeover bid.
When it comes to buying gold, the Russian Oligarchs are definitely making their position crystal clear, expecting gold to improve even more over the coming months and years and determined to get their slice of the pie.
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