Thursday, March 19, 2009

Paulson Joins Einhorn--in Gold

We reported earlier that Seth Klarman was investing in gold--like Einhorn. Paulson is getting long the noble metal as well:
Paulson, bought a stake in AngloGold Ashanti Ltd. (AU) from Anglo American Plc for $1.28 billion as hedge funds increase their gold holdings.

Paulson paid $32 a share for the 11.3 percent stake in the Johannesburg-based gold miner, Anglo American said today in a statement. The purchase makes Paulson the company’s second- largest shareholder, according to data compiled by Bloomberg. Paulson also owns a 4.1 percent stake in Kinross Gold Corp (KGC)., making the hedge fund the fourth-largest holder of the gold producer.

Hedge funds are turning to gold to mitigate potential inflation as governments around the world increase spending to stimulate their recession-bound economies. David Einhorn, founder of New York-based Greenlight Capital Inc., told investors in January that he is buying gold for the first time. Hayman Advisors LP’s Kyle Bass said investors are seeking precious metals as central banks print more money.

“Hard currency is coming to the fore, as evidenced by the investment choices of some of the world’s most seasoned investors,” AngloGold Ashanti Chief Executive Officer Mark Cutifani said today in an e-mailed statement.

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