By Henry Bonner ( firstname.lastname@example.org)
Eldorado Gold has aggressively pursued building mines in 'tricky' jurisdictions - in particular China. But right now, Eldorado Gold is looking to restructure its ownership of the Chinese assets. It is planning to partially divest itself of its Chinese assets, placing them into a new company listed in China, and partially owned by new Chinese investors. Eldorado Gold Corp. is currently the fourth largest holding of the Sprott Gold Miners ETF (NYSE: SGDM). As ofDecember 11, 2014, SGDM had a 5.04% weighting in Eldorado Gold, which is subject to change. For more information and disclosures, please visit www.SprottETFs.com. Our affiliate, Sprott Asset Management LP, is the sub-advisor to the Sprott Gold Miners ETF. Paul Wright became CEO of Eldorado in 1999. He joined me to discuss Eldorado's partial divestiture of its Chinese mines and projects. What he said is useful for investors who are looking at opportunities outside the US and Canada. What is Eldorado's plan for its Chinese assets? We are restructuring our ownership of the Chinese assets by publically listing the subsidiary which holds these assets. The subsidiary would own three mines and our Eastern Dragon joint venture. It would be listed in Hong Kong, instead of Toronto. Eldorado would be the majority owner of that new company, and we're looking to have international and mainland Chinese institutional investors come in as well. The idea is that the new company will do better operating and growing its business as a Chinese entity in China, than as part of a Toronto-listed foreign mining company. So, why transfer the assets to a Chinese subsidiary? In the last two or three years there has been less and less interest in China generally from North American investors. That has negatively affected the way that the Chinese assets are viewed in our portfolio by the North American market. The value we get from our Chinese assets is priced at a discount.