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Johannesburg - Shares in Harmony Gold Mining Company [JSE:HAR] rose by nearly 6% on Thursday, after an investment research note suggested the company could be a takeover target.
By mid-morning the share price was up 5.92% at R93.25. The Johannesburg bourse's mining index was just 1.63% higher at that time.
In a note on Wednesday, Royal Bank of Canada (RBC) had raised its rating on shares in Harmony, the world's fifth-largest listed gold miner, to "outperform" from "sector perform" and said the miner's potentially lucrative Papua New Guinea (PNG) prospect meant it could be a takeover target.
"People are having another look because of its PNG assets," said a South African-based analyst, referring to the RBC note.
The RBC note said: "Another gold major could be looking at a strategy of making a bid for Harmony with the aim of stripping out the PNG assets and re-listing the rump as a separate vehicle."
The note said it was some years before Harmony's Wafi-Golpu deposit in Papua New Guinea could figure in earnings forecasts for the company, but it could eventually add $1.5bn to $2bn to the value of Harmony, 40% of its current market value.
"The 'lucky' part of the equation is really reflected in the outstanding exploration results seen at the Wafi-Golpu deposit... We believe this exploration play is fast becoming a central play in the valuation of Harmony," RBC said.
By mid-morning the share price was up 5.92% at R93.25. The Johannesburg bourse's mining index was just 1.63% higher at that time.
In a note on Wednesday, Royal Bank of Canada (RBC) had raised its rating on shares in Harmony, the world's fifth-largest listed gold miner, to "outperform" from "sector perform" and said the miner's potentially lucrative Papua New Guinea (PNG) prospect meant it could be a takeover target.
"People are having another look because of its PNG assets," said a South African-based analyst, referring to the RBC note.
The RBC note said: "Another gold major could be looking at a strategy of making a bid for Harmony with the aim of stripping out the PNG assets and re-listing the rump as a separate vehicle."
The note said it was some years before Harmony's Wafi-Golpu deposit in Papua New Guinea could figure in earnings forecasts for the company, but it could eventually add $1.5bn to $2bn to the value of Harmony, 40% of its current market value.
"The 'lucky' part of the equation is really reflected in the outstanding exploration results seen at the Wafi-Golpu deposit... We believe this exploration play is fast becoming a central play in the valuation of Harmony," RBC said.
