The Glone and Mail - 01.08.2019

[ECONOMY]

INVESTMENT SUCCESS IS ABOUT IDEAS

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OTTAWA/QUEBECEDITION ■ THURSDAY,AUGUST1,2019 ■ GLOBEANDMAIL.COM

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tounderstand B

Kinross Gold Corp.has struck a

US$283-million deal to buy a Rus-

siangolddevelopmentproject,its

firstgoldacquisitioninfouryears.

Inastatementafterthecloseof

markets on Wednesday, Toronto-

based Kinross said it had reached

a friendly arrangement with pri-

vately held N-Mining Ltd. to pur-

chase the Chulbatkan project for

a combination of cash and stock.

Kinross hopes to eventually de-

velop the property, located in the

Khabarovsk region of Russia’s far

east,intoalow-cost,open-pitgold

mine.

Cyprus-based N-Mining was

founded by a number of former

executivesofPolyusGoldInterna-

tional Ltd., Russia’s largest gold

producer.

Kinross said its own drilling,

conducted over the past 16

months, indicates the Chulbat-

kan property contains a resource

of 3.9 million ounces of gold.

Over the next three years, Kin-

ross plans to do more drilling to

trytoprovetheproject’seconom-

ic viability.

KINROSS,B

Kinrossadds

toRussian

footprintwith

purchaseof

goldproject

NIALLMcGEE

MININGREPORTER

CannTrust Holdings Inc. has
hired the Canadian arm of U.S. in-
vestment bank Greenhill & Co. to
help it review options, including
the possible sale of the company,
as the cannabis producer awaits a

decision on its fate from Health

Canada.

A sharp drop in CannTrust’s

share price over the past three

weeks has made the cannabis

grower based in Vaughan, Ont., a

potential takeover target. The

shape of any deal would likely de-

pend on whether Health Canada

decides to suspend or revoke

CannTrust’s licences as a penalty

for growing cannabis in unlicens-

ed rooms in late 2018 and early

2019–amovethatcoulddrivethe

company out of the pot business.

It has already suspended all sales

while a Health Canada investiga-

tion is carried out.

“The nature, timing and out-

comeofthestrategicreviewproc-

ess will be influenced by, among

otherthings,theresolutionofthe

company’s regulatory compli-

ance issues with Health Canada,”

Canntrust said in a statement

Wednesday.

The strategic review “could in-

clude, among other things, a sale

of the company or a portion

thereof, a strategic investment, a

business combination, changes

to the company’s operations or

strategy, or continuing to execute

on the company’s current busi-

ness plan,” CannTrust said in its

statement.

The announcement comes six

days after CannTrust fired its

chief executive officer.

CANNTRUST,B

CannTrusthiresadviser,exploressale

InvestmentbankGreenhill&Co.conductingstrategicreview,butanydeallikelytohingeonstatusofcannabisproducer’slicences

MARKRENDELL
CANNABISINDUSTRYREPORTER

FederalReserveChairJeromePowellcutinterestratesbyaquarter-percentage-pointonWednesday.

ANDREWCABALLERO-REYNOLDS/AFP

B

y deciding to cut interest rates, the Fed-

eral Reserve has positioned itself as a

shield, protecting the U.S. economy

from its owngovernment’s worst in-

stincts. But it may have also set itself up to be

President Donald Trump’s enabler.

The Fed’s quarter-percentage-point rate cut

announced Wednesday – lowering the federal

fundsratetoarangeof2percentto2.25percent,

itsfirsteasingsincethefinancialcrisisin2008–

is decidedly not something the U.S. economy is

screaming for right now. It’s not even whisper-

ing for it. Not when the economy is already op-

erating at full capacity (if not over capacity),

with growth in the second quarter, at 2.1 per

cent,highenoughtosqueezethatcapacityalit-

tlemoreandunemploymentnear50-yearlows.

Sure, Fed chairman Jerome Powell talked in

his news conference about the Fed’s worries

that inflation is slightly below its target. But

against that economic backdrop, it wasn’t very

convincing. Inflation may be part of the Fed’s

justificationforthismove,butit’snotthemoti-

vation.

PARKINSON,B

Withratecut,Fedtakesout

insuranceonTrump’stradeagenda

Centralbank’smovetoprotectU .S.economyagainsteff ects

oftariffwarcouldenablefurtherprotectionistmoves

DAVID

PARKINSON

OPINION

RobCarrick:HowtheFedratecuthelpsCanadians

whoborrowedtoomuch B