April 26 (Bloomberg) -- Highland Gold Mining Ltd. plunged to a 20-month low in London trading after Barrick Gold Corp. sold its 20 percent stake in the gold miner part-owned by Russian billionaire Roman Abramovich at a discount.
Highland Gold slid as much as 9.7 percent to 118.75 pence, the lowest intraday price since August 2010. The shares traded at 125 pence as of 1:40 p.m. local time.
Barrick Gold, the world’s largest producer, sold its stake in Highland Gold to undisclosed “institutional investors” at 120 pence a share, according to a statement today. The shares closed at 131.5 pence yesterday.
“The large discount offered by the seller attracted investors who hadn’t been looking at Highland previously,” said Nikolay Sosnovskiy, an analyst at VTB Capital in Moscow. “The sale price corresponds to enterprise value of two times earnings before interest, taxes, depreciation and amortization, which is really cheap for a gold company.”
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