It happens all media organisations - the FT included. Whether it’s high market jinks or financial skulduggery, the fact is people make up stories and sometimes newswires and newspapers swallow them.
Earlier on Wednesday Bloomberg reported that a US financier by the name of Edward Pastorini was preparing to lead a $12.5bn bid for Gold Fields, the South African miner that counts as the world’s fourth-largest gold producer.
Shares in Gold Fields spike 11 per cent in response to the news.
We pointed out here earlier on FT Alphaville that Mr Pastorini didn’t seem to register on the radar — no one’s radar. Not Google, not Factiva, nowhere.
And to top it all, crossword fans: Edward Pastorini - the letters also happen to form “Top Insider Award.”
But that hasn’t stopped Bloomberg pushing out constantly up-dated versions of its own “scoop.”
Disconcertingly, the evidence that this supposed takeover bid is a hoax is sitting there in Pastorini’s words, quoted by the agency:
“The LBO firms, corporate raiders and I feel that gold is going to rise to over $1,000 an ounce over the next two to three years,” he said in an e-mailed response to questions yesterday. “It makes sense to own one of the best gold companies and enhance the values of each of its gold mines separately in the markets….”
…Pastorini’s group is already buying shares in the open market, he said in the e-mail. The strategy is to accumulate as much as 10 percent of Gold Fields’ stock by June or July before making an offer, he said…
…Pastorini, who doesn’t publicize his business activities, has been involved in “past original deals'’ including Newmont Mining Corp, Homestake Mining and Atlas Corp, according to one of documents…
…”I prefer to stay private, which is what I have managed to be for over 25 years in the mergers and acquisitions business,” he said in the e-mail. “That’s how my partners and I like it. I keep my name out of things and simply do the work behind the scenes.”…
…The document sketches out a plan to buy the company and spin off its assets before selling a small stake in each. The selling price would value the mines at more than Gold Fields itself, it says…
…“Those shares will be bid up by investors significantly and very quickly will become overpriced for a number of months, or maybe even years,'’ Pastorini said in the document. If successful, the investors will “end up not only recouping our entire investment in one year, but we would all have significant profits in the acquisition.'’ Think about it! If Mr Pastorini had really spent 25 years in the M&A business he might have learnt not to spill the beans two months before he’s going to launch a bid. He might have figured out that opening his heart to a journalist is only going to jack up the cost of his little caper significantly.
Of course, Mr Pastorini may have convinced himself that he really is going to pull together “LBO firms, corporate raiders” who can rustle-up £12.5bn.
He might even be related to Mark Paulsmeier, the deluded South African financier who thought he might bid for Marks & Spencer a couple of years back.
