Trading halt for LionGold as stock dives
Australian investors in gold with exposure to Singapore company LionGold were on the wrong end of the company's curious share price on Friday, when the stock suddenly fell by more than 40 per cent.
LionGold, which has spent the past 18 months acquiring some of Australia's most marginal gold assets in exchange for its own shares, was put in a trading halt by Singaporean authorities out of concern that the market was not fully informed.
Among the assets LionGold has acquired since taking an interest in gold 18 months ago are the fields near Ballarat, Victoria where the Eureka Stockade took place.
It has also acquired, or taken stakes in, marginal gold assets in Queensland and Western Australia, plus a Bolivian mine that is possibly at risk of nationalisation.
LionGold's preference for scrip transactions has meant many Australian investors have ended up with an exposure to the Singapore company, which did not return calls after Friday's slump.
LionGold's share price movements have been queried more than once; in August it rose by almost 40 per cent.
Two other Singapore companies with varying links to LionGold were put in trading halts on Friday after their stock fell sharply.
One - Blumont Group - has at least one director in common with LionGold. Its stock slumped by 56 per cent. It is thought to be trying to make a takeover bid for Australian coal junior Cokal.
The other, Asiasons, is a fund manager that owns the biggest stake in LionGold. Its stock fell by 61 per cent before being put into a trading halt.
Friday's volatility in Singapore came days after Linc Energy announced plans to leave the ASX in favour of a listing on the Singapore exchange, partly in the belief that the stock was undervalued in the Australian market.