Highland is aiming for gold

THE Fleming merchant banking family is hoping to join a new gold rush. It holds a £50m stake in Highland Gold, the latest prospector looking to join the lightly regulated Alternative Investment market.

Despite its name, Highland operates three mines on the steppes of Siberia, near the Mongolian border. Aintree racecourse chairman Lord Daresbury and 'It' girl Tara Palmer-Tomkinson's uncle Charles are among the other directors and shareholders.

Highland is hoping for a £200m valuation, which sounds highly ambitious. Present shareholders will sell up to £5m worth. It claims 8m ounces of reserves, with likely production costs of $145 an ounce and first-half reported profits were £9.5m pre-tax.

South African mining group Harmony valued Highland at just £40m six months ago when buying 32.5%, but since then the group has vastly increased its holdings. Auditor Ernst & Young expressed reservations about some expenses in the accounts.

AIM is enjoying a mining flurry. South Africa's Apex Platinum, Australia's Midas Gold and Canada's Bema-Gold also hope to float this month. Thistle Mining and Jubilee Platinum are among recent listings.

Many predict gold, now $319.70 an ounce, will surge if the world economy worsens. However, sceptics point out it failed to rise much during July's market meltdown.