Markets

European Goldfields Up 4% on Talk of Centerra Interest; Centerra 6% Lower

European Goldfields Ltd. (EGU), a metals explorer and mine developer with projects in Greece, Romania and Turkey, reached the highest price in five months after Centerra Gold Inc. (CG.TO) reportedly expressed interest in the company, Bloomberg reported. Centerra is down nearly 6%.

European Goldfields rose 5% to $13.50 at 9.57 a.m. in Toronto, the highest intraday price since July 11, after the London-based Sunday Times reported yesterday that Centerra made an approach to the company. Centerra's interest came after Vancouver-based Eldorado Gold Corp. (ELD.TO) made a preliminary approach, the newspaper reported, citing unidentified sources.

European Goldfields said in a Dec. 6 statement that it received "preliminary and indicative approaches from third parties" regarding potential deals, Bloomberg said. No formal offers had been received, the Whitehorse, Yukon-based company said, without identifying the third parties.

Gold miners including the biggest producer, Barrick Gold Corp. (ABX.TO), and fellow Canadian Iamgold Corp. (IMG.TO) are seeking acquisitions to increase production amid record prices for the precious metal. Gold rose to a record of US$1,923.70 an ounce in New York on Sept. 6.

Centerra, which has gold operations in Kyrgyzstan and Mongolia, said in June 2010 it may spend as much as $3 billion buying assets to boost production. John Pearson, a spokesman for Toronto-based Centerra, said yesterday the company doesn't comment on market speculation.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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