Zijin Gold International, a precious metal mining focused subsidiary of Zijin Mining Group Ord Shs H (OTCMKTS: ZIJMF) (FRA: FJZ), is close to finalizing its initial public offering. The Chinese gold company is well on its way to raising US$3.2 billion with its public launch on the Hong Kong Stock Exchange.
Following the IPO, shares will begin trading under the ticker symbol 2899.HK on Sept. 29. It was the Special Administrative Region’s largest since JD Logistics Inc (HKG: 2618) raised US$3.6 billion with its Hong Kong debut in 2021.
Zijin will be using the half of the funding acquired to upgrade current mines over the next five years. Meanwhile, 33.4 per cent will be allocated to finalizing the acquisition of Kazakhstan’s Raygorodok gold operation. The rest will be put toward exploration activities and general corporate expenses.
Zijin Gold will be running all of its parent company’s gold mines outside of China. These consist of open pit and underground operations in Tajikistan, Kyrgyzstan, Kazakhstan, Colombia, Suriname, Guyana, Ghana and Australia.
Cornerstone subscribers that have taken more than half of the initial public stock offering thus far include the Singapore sovereign-wealth fund, BlackRock Inc (NYSE: BLK) and Schroders plc (OTCMKTS: SHNWF) (LON: SDR). They got first dibs by agreeing to hold onto their stake for at least six months.
Zijin published a Prospectus on the Hong Kong exchange’s website Friday outlining key details. With regard to the market opportunity being presented, the gold producer has estimated that a steady trend of gold purchasing by investors and central banks will only continue. This is particularly true in “emerging” countries or those that are not members of the Organisation for Economic Co-operation and Development, Zijin says.
Citing data from market researcher Frost & Sullivan, the newly launched gold company highlighted that gold only accounts for 8.9 per cent of the asset reserves of those countries as opposed to 25.2 per cent in developed nations.
“This disparity highlights significant potential for increasing strategic reserves of gold among emerging countries,” Zijin explained.
Furthermore, the mining company pointed out that gold has officially surpassed the Euro to become the second-largest reserve asset for central banks. It now accounts for 20 per cent of official international reserves and is second only to the United States dollar (46 per cent).
This bullish outlook for central bank buying is further complemented by the metal’s price, which has ascended by 39 per cent since Jan. 1 after gains exceeding 25 per cent throughout 2024.
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