Twenty-Five Years Ago / February 1979

Black pushes for rapid growth

Within two months of the entry of Toronto financier and industrialist Conrad Black and his brother, G. Montagu, to the board of directors of Hollinger Mines, the company and its subsidiary, Labrador Mining & Exploration, are making a $41-million bid for control of Bow Valley Industries of Calgary.

Bow Valley’s revenues are expected to jump to $184 million in 1984 from $39 million in 1978. The new direction, from an essentially holding company status for Hollinger and Labrador, had been expected. The combined working capital of the two companies exceeds $100 million.

Hollinger and Labrador hold a combined 12.1% interest in Iron Ore Co. of Canada, this country’s largest iron ore producer, and almost 11% in Noranda Mines, the largest single shareholding in that company.

Iranian troubles fuel gold surge

In a massive US$14 surge, the price of gold has risen to an all-time high of US$244.50 per oz. The news is especially good for Canadian producers, since the translation into Canadian currency pushes the price into the $293-per-oz. range.

Of course, the rise in the price of gold is merely a reflection of a slump in the value of the U.S. dollar. The latter’s most recent retreat was precipitated chiefly by the trouble in Iran. The Pentagon has pulled out three-quarters of its 1,000-man military advisory staff from Iran.

Silver hits new high

Spurred by heavy speculative buying on international hedge markets and good consumer business for physical supplies, silver prices advanced sharply last week. New all-time high records (US$9 per oz.) were established and, according to many market experts, prices will rise even higher in the weeks ahead.

Contributing to the metal’s surge were three chief factors: the political crisis in Iran; weaker North American currencies; and continued drawdown on silver stocks in warehouses approved by the New York Commodity Exchange.

New gold coin for Canada

After some 30 months of discussion and lobbying by the Canadian gold mining industry, the federal government has decided to proceed with the minting and marketing of 1-oz. gold coins, to be known as the Gold Maple Leaf.

The coin will have a face value of $50 but will sell at a price based on the market value of gold.

In case the full amount is not available from Canadian producers, the Canadian Mint will acquire additional gold from the country’s current reserve of 22 million oz.

Teck merger to top $250m

The merger of Teck, Yukon Consolidated Gold and Brameda Resources will result in an entity with assets in excess of $280 million.

“The merger makes a lot of sense,” says Teck’s Norman Keevil, Jr. “It will create a single strong company out of three, one with substantial prospects for continued growth. Its production base and inventory of reserves will place the new entity near the top rank of Canadian resource companies.”