Henderson’s Peak defies Egypt political risk with new purchase
Stephen Peak added Egyptian-based gold producer Centamin Egypt to the £459m Henderson UK Alpha fund despite the country’s ongoing political tensions.
The manager started a new position in the miner in May after its shares “derated significantly” during 2011, mainly due to investor perception of political risk in the country.
Egypt has seen tension on the political stage since the start of 2011, when the protests began that eventually ousted then-president Hosni Mubarak. The country is currently in the midst of disputed presidential election.
“We now believe that [Centamin Egypt’s] derating has gone too far for a company with a very attractive gold asset with a significant production ramp-up to come in the near term,” Peak writes in the fund’s latest factsheet.
At the end of May the company published an updated five-year mine plan for the Sukari gold mine, predicting an increase in the grade of open pit ore sent to its mill to between 1.1 and 1.52 grammes per tonne.
Centamin Egypt’s shares rallied on the plan, which also anticipates increased production rates from the mine over the coming four years.
During May, the Henderson UK Alpha fund also added to its positions in online gambling company Bwin.Party Digital Entertainment and sold its holding in diamond mining group Petra Diamonds.
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