Lihir Gold's Market Value Plummets Amidst Citigroup's Stock Sale

Strategic Insights -

The sale of Citigroup's 14.5% stake in Lihir Gold Ltd. by Anglo-American miner Rio Tinto PLC led to a significant decline in the market value of Lihir Gold. The stock price dropped by 11% to A$2.08, resulting in a market value loss of nearly A$350 million. This decline was partly due to a fall in gold prices, which dropped to US$494.00 an ounce in New York.

Key Takeaways:

  • Citigroup sold A$399 million worth of Lihir Gold shares to investors at A$2.15 a share as part of a bookbuild exercise.
  • The sale of Rio Tinto's 14.5% stake in Lihir Gold was conducted at the same price of A$2.15 a share.
  • The gold price fell by US$4.50 to US$494.00 an ounce, contributing to Lihir Gold's share price decline.
  • Lihir Gold's market value dropped by nearly A$350 million due to the share price decline.
  • The sale of Citigroup's Lihir Gold shares was conducted at the bottom of a bookbuild range of A$2.15 to A$2.20 a share.
  • London-based Rio Tinto sold its stake in Lihir Gold after the gold miner's share price had more than doubled in the past year.
  • The sale of Rio Tinto's stake in Lihir Gold occurred on the same day the gold price passed US$500 an ounce for the first time in 18 years.

Statistics:

  • A$350 million: the market value loss of Lihir Gold due to the share price decline.
  • 11%: the drop in Lihir Gold's share price to A$2.08.
  • A$2.15: the price at which Citigroup sold Lihir Gold shares to investors.
  • A$2.08: the final share price of Lihir Gold after the decline.
  • A$2.67 billion: Lihir Gold's market value after the share price drop.
  • US$4.50: the drop in gold prices to US$494.00 an ounce.
  • 14.5%: Rio Tinto's stake in Lihir Gold.
  • A$399 million: the total value of Lihir Gold shares sold by Citigroup.

Sources:

  • Dow Jones Commodities News via Comtex
  • Dow Jones Newswires
  • Rio Tinto PLC
  • Lihir Gold Ltd.