City Diary; There's something in them there bore holes

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The Independent Online
British investors in Timbuktu Gold are holding their breath as they wait to hear whether the Calgary-listed mining company launched in February is either one of the most exciting gold mines ever discovered or merely a hole in the ground. City broker T Hoare specialises in commodity companies in out-of-the-way locations, and placed 4 million shares with British institutions when Timbuktu Gold floated in January.

The company was launched by Oliver Reese, a North American-based entrepreneur, in order to prospect for gold in Mali. The shares were issued at C$1.30 and pottered along in the C$6 to C$8 range, until the middle of April, when a bore hole showed "almost pure gold," according to one investor. The shares soared to a high of C$26.70, valuing the company at more than pounds 300m. Then the Alberta Stock Exchange heard from a journalist that the US Securities and Exchange Commission (SEC) had made two complaints against Mr Reese, complaints he had not told Alberta about.

On the 19 April the shares were suspended. In the two days preceding the suspension more than 1.7 million shares were traded.

A single institution, believed to be British, sold more than half a million shares, having trebled its money. Both T Hoare and the Alberta Stock Exchange sent teams out to investigate the Mali bore holes at first hand and carry out further drilling. One City investor told the Independent yesterday he had heard that liquid gold had been poured down one bore hole to fool the testing equipment.

Tim Hoare said he did not know anything about this - "it's very early days". He added that they would know one way or another about the site "in about three weeks".

Wales' newest crematorium has made history by being the first to use TV advertising. The 30-second ads for the Aberystwyth Crematorium Company on the Welsh S4C channel appear in both Welsh and English language versions. Spokeswoman Dawn Havard said: "The ads are very factual - they show the shops, the wonderful setting, how very friendly the staff are. Obviously we have had to think very carefully about the content. It's a sensitive subject." For the man who directed the video it is familiar territory. Dyfrig Davies of Llandeilo is from a family of well known funeral directors in west Wales and is himself qualified in the field. "It is satisfying to know that a short video like this can help local people in a time of need," he said.

The "King of Eurobonds" is heading east. The legal king, at least. Andrew Carmichael, a partner in the capital markets department of City law firm Linklaters & Paines, has advised investment banks on the multi-trillion- dollar Eurobond market for the last 15 years. Now he's off to head up the firm's Hong Kong capital markets office. Lately Mr Carmichael has been so dominant that some observers reckon he was pulling in as much work as the entire second-biggest legal player in the market, solicitors Allen & Overy.

Terence Kyle was also a big Eurobond player at Linklaters until he moved upstairs to be managing partner a year ago. Now firms like Allen & Overy and Freshfields are licking their lips.

It's an ill wind. British Gas has responded to its execrable public image by employing an army of spin doctors from four different firms. They are (takes deep breath): The Maitland Consultancy to advise chairman Richard Giordano; a "horde" of people from Shandwick to advise on the demerger between TransCo and British Gas Energy; George Pitcher of Luther Pendragon for the Millenium site at the former British Gas plant in Greenwich; and two men from Prima, an agency owned by Burson-Marsteller. These last two are Dick Taverne, the former Labour MP who joined the SDP, and Roger Liddle, an ex-Liberal, who co-authored the biography of Tony Blair with Peter Mandelson. Mr Taverne is a former director of BOC, where he met Mr Giordano, who brought him in to advise on political matters. Phew. Why didn't they just give all these fees to the shareholders?