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By Mike Caggeso
After three months of interviewing dozens of candidates, board members of Harmony Gold Mining Co. (HMY) have unanimously elected as the South African miner's chief executive officer.
The arduous selection process began in October when a four-person selection panel tapped an executive search company to help find the best candidate. Thirty-six other candidates were reportedly interviewed for the job.
The list was whittled down to four before selecting Briggs, 51, who had already been serving as acting CEO since Bernard Swanepoel resigned in August, when the company forecast a loss for the quarter ended June 30, 2007.
Briggs begins his new/old job immediately.
"He has been overseeing the introduction of the Harmony ‘back to basics' management style and has done a great job," Harmony Chairman Patrice Motsepe said in a statement. "Harmony is on its way to being the globally competitive and profitable company that we know it can be."
Harmony is the.
Briggs has a 13-year tenure with Harmony, beginning with his first post as a manager of new business in 1995. In 2005, he was promoted to CEO of Harmony Australia and regional manager for Australiasia.
Harmony is hoping its new CEO ushers in a new and better year. In 2007, in addition to having its CEO depart and posting the quarterly loss, Harmony also made headlines for a mining accident that trapped more than 3,200 miners underground.
Although all the miners escaped death, the firm was vilified for allegedly cutting corners of safety.
On top of that, gold production in South Africa – the world's second-largest gold source – continued its decline, forcing companies with mines to drive up production costs by digging deeper. And above ground, the South African rand appreciated significantly in 2007, biting off a large piece of gold's 25% gain in value last year.
All That's Gold Doesn't Glitter
As the turmoil at Harmony reaffirms, investors should not walk into any gold investment blindly, or think that a gold mining company's stock is the best way to profit from gold's metoric rise in the past several years.
Viewed as a hedge, and purchased at the right time, gold will provide a sound addition to many investment portfolios. And if the yellow metal also manages to produce massive gains, even better.
All that said, though, there are gold investments that combine both safety and performance.
The StreetTracks Gold ETF (GLD) offers bullion-based pricing without the storage problems and liability of delivery.
Shares prices of Toronto-based gold-mining company Barrick Gold Corp. (ABX) – the biggest gold producer in the world – performed about in line with gold itself during 2007. But be wary of mining companies. They face the same inflationary pressures that everybody else does. And gold bugs aren't inherent risk-takers.
If you are looking for gains that accurately – and safely – track the price of gold, another possibility worth a look is a pooled precious metals account, where you can buy gold and silver for as low as 1% above market price, while reaping the benefit of storage and maintenance fees that are lowered by spreading the costs across a pool of investors.
Editor's Note: Associate Editor Mike Caggeso, who covers gold and commodities for Money Morning, recently wrote about gold's prospects in the New Year as part of our "Outlook 2008" series, which looks at global investing opportunities for the year ahead. To read that report, which is free of charge, please click here.
News and Related Story Links:
- Money Morning Investment Analysis:
Outlook 2008: Gold Investments Will Continue to Glitter in the New Year.
- Forbes.com: .