Coal window
2008-04-11
Baron Rothschild famously said that the time to buy is when
there's blood in the streets. For New World Resources, the time
to sell a stake in Rothschild's old Moravian-Silesian coal mines
is when the blood-spilling has let up. NWR announced a
potential E1.4bn initial public offering yesterday that comes
after the recent massacre on the markets has settled down. But
it also comes as market-watchers are predicting a bursting of a
perceived bubble on the commodities markets. NWR is
conveniently squeezing its IPO into a nice window of
opportunity. It rests its hopes on the argument that the "bubble"
in coal prices isn't a bubble at all, because the entire price curve
has been shifted upward by increased demand. It's true, too,
that coal isn't as susceptible to speculation as some other
commodities. Whether these arguments would be enough to
convince Baron R. to buy now is for each to decide.
[Czech Republic RPR Industries OKD Zdeněk Bakala]
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