Sean’s Investment Review

FSB to probe GoldField “bid”

The Financial Services Board (FSB) is set to launch an investigation stemming from a story run by Bloomberg on Wednesday about a mooted bid for Gold Fields that caused the mining house to gain almost R10 billion in value.
Gerhard van Deventer, the FSB’s executive director for market abuse, said the watchdog would start a preliminary investigation into the news wire’s story, on which Business Report reported yesterday, to see whether anyone should be investigated for distributing false and misleading information.

Van Deventer said the story run by Bloomberg about a bid for Gold Fields might have been a hoax.

Bloomberg issued a report early yesterday morning saying that the agency could not verify its story that mysterious US financier Edward Pastorini was interested in leading a bid for Gold Fields.

The documents it mentioned in its Wednesday report were sent by an unnamed Gold Fields executive, Bloomberg said.

One analyst said: “If a Gold Fields executive is involved that is pretty serious. Hopefully the FSB will get to the bottom of this. An investigation is warranted.”

Gold Fields spokesperson Willie Jacobsz was not available to comment.

top.DisplayAds(‘SquarLAV’,17,563); Bloggers on the website of the Financial Times pointed out that Pastorini did not seem to exist and that an anagram of his name happened to form the phrase “top insider award”.

Bloomberg said that the office number provided by Pastorini was used in 2003 by a Florida partnership that made phoney takeover bids. The news wire admitted that Pastorini had declined to divulge his background, address or who he represented.

Van Deventer said that, depending on what was uncovered from the preliminary probe, the FSB could launch a full investigation into the matter. He had been alerted to the possibility that the report was a hoax by Peter Redman, the JSE’s senior technical adviser on surveillance, yesterday morning.

The preliminary investigation was being conducted in terms of section 76 of the Securities Services Act of 2004. Redman said the JSE had referred about six cases, including the Gold Fields case, to the FSB since the act came into force.

The JSE had met with Gold Fields representatives yesterday and the company had supported the JSE’s move to hand the case over to the FSB.

Gold Fields shares closed down 1.4 percent at R140 yesterday, valuing the firm at over R91 billion.

(BusRep)