Monday, 21st May 2007 (3699 views)

World-renowned billionaire investor Warren Buffet has decided to finally invest in gold and bet on bling, after ridiculing its lack of utility a decade ago.

He once said in 1998 that "gold gets dug out of the ground in Africa or somewhere" then "we melt it down, dig another hole and pay people to stand around guarding it". He scoffed that "it has no utility" and "anyone watching from Mars would be scratching their head".

But in a sensational u-turn, Mr Buffet announced on Friday that he acquiring various gold miners and consolidating them into the newly formed Richline Group, which is aiming to become the US's largest jewellery supply group.

He will acquire Bel-Oro International and Aurafin which are both US gold jewellery manufacturers and combined, these firms will hopefully account for six per cent of the world's gold jewellery market.

The transaction will close during the second or third quarter of this year with the Richline behemoth expected to employ some 1,800 people and generate $500 million (£250 million) in revenue.

 

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