Gold company Durban Roodepoort Deep (DRD) has upped its stake from 1.4% to 14% in Web gold trading portal GoldMoney with an investment of $1.8 million (about R10 million).
DRD, which is listed in Johannesburg, Sydney and New York, bought its first stake in GoldMoney in January for about $200 000 (R1.3 million). The site`s founder, James Turk, says his portal has enjoyed record growth since the South African miner bought in.
"Our customer base rose by more than 20% in the first quarter of 2004 to 12 000 worldwide, and we increased our holding of physical gold by 51% from 66 LBMA [London Bullion Market Association - a quality measure of gold bars] gold delivery bars to 100."
Turk says that since DRD came on board as a GoldMoney shareholder, all of the LBMA bars added to the system have been sourced from the Rand Refinery.
"GoldMoney`s success in recent months shows that, at the outset, we were right in identifying it as a suitable vehicle for fulfilling our belief in gold as money and as a means of encouraging private ownership in gold," says DRD CEO Ian Murray.
GoldMoney has customers in more than 100 countries, while gold held in allocated storage for the company`s clients is close to 30 000 ounces. The portal operates by means of storing gold in vaults globally, and only units of account called "goldgrams" are exchanged.
Just like a share of stock represents an investor`s ownership of a fraction of a publicly traded company, a goldgram represents a buyer`s ownership of a portion of the gold held for GoldMoney customers in a secure vault in London. GoldMoney`s servers keep track of purchasers` ownership of goldgrams and the gold held is insured by Lloyds of London.
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