Mariner Financial (MFI) 54c ACCORDING to Argonaut Securities, the gold price is likely to be supported by the $US weakness, global inflation threats and the catch-all rationale of global economic uncertainties. "Gold bulls have to be cautious, though," warn the Argonauts. "The gold sector has been a tough one in recent times with companies delivering more bad than good news." It's an auspicious time to be entering the sector, but Mariner is confident of building a strategic gold fund with Gryphon as the seed investment. Mariner has also cast its eyes at other resources investments, but is enamoured of the yellow stuff because of the supportive economic factors. Mariner's natural resources head, Kelvin Russell, can't be sure of the size of the fund, but it's unlikely to rival Mariner's $1.2 billion of other investments ranging from real estate and mortgage trusts to gas pipelines and the Sydney Opera House car park. But the gold fund will look at anything which makes sense and looks cheap enough. "I would not rule out anything now because we are value investors," Russell says. With muted signs of the resources boom tiring, it's heartening to see astute investors such as Mariner entering the sector at a late stage. We rated Mariner a buy at 62c on September 18 after it lobbed a $61 million bid for Beyond International. If it wins the contested bid, Mariner intends to use the production house as a seed asset for a $200-300 million fund, which goes to show they don't have a blinkered investment philosophy. We maintain a buy on Mariner as a high-yielding play. But like the Macquarie Banks and Babcock & Browns of this world, the game's up if they can't pick up cheap assets and move them quickly into satellite funds.
MFI Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
