Business / Gold rush in China

Cnrun becomes largest shareholder of UK gold firm

( Updated: 2012-11-01 16:25

Cnrun Investment Holdings Co has become the largest shareholder of Vatukoula Gold Mines Plc after buying 6.6 million pounds ($10.62 million) worth of Vatukoula's shares, the National Business Daily reported.

Cnrun is a fully owned subsidiary of Chinese real estate investor Zhongrun Resource Investment Corp.

The 20 million shares were sold at 0.33 pound per share. In April, Zhongrun bought 9 million shares at 0.6 pound per share.

This is the latest move in Zhongrun's transformation into a major mining and resources investor, as its real estate investments are being hit by China's property control policies.

The investment will be used to improve Vatukoula Gold's underground mining system. The improvements are expected to boost the company's annual gold production from 1.7 tons to 3.1 tons.

Vatukoula Gold, which is listed on the London Stock Exchange, had net assets of 69.82 million pounds as of May 31, 2012.

The company estimated a total net profit of about 2.5 billion yuan ($397 million) in the next 7 years, the newspaper reported.

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