Mining

Thorny Acacia pricks Barrick boss’s Africa bubble

11 June 2019

The bullion miner’s minority shareholders look set to spurn a 226 mln pound bid from its Canadian parent, prolonging a tax row with Tanzania. That’s a blow for CEO Mark Bristow’s status as an African gold guru. His hardball tactics are also unlikely to impress other partners.

Rare-earth gun is best left in Beijing’s holster

29 May 2019

China, which dominates supply of minerals like neodymium, has hinted it might squeeze exports to the United States. In the past, similar embargos caused buyers to find substitutes; bans are hard to enforce, too. The threat suggests retaliatory options are limited.

Barrick’s lowball Acacia offer is easy to refuse

22 May 2019

The Canadian bullion producer offered to buy out minority shareholders in the Tanzanian miner at an 8% discount. That gives an out from an $180 bln tax dispute with the East African country. It’s a bitter pill, but looming arbitration gives shareholders reason not to swallow it.

Vedanta Zambia mess tarnishes Anglo breakup pitch

22 May 2019

President Edgar Lungu wants to nationalise the Indian firm’s Konkola copper mines. The hit looks manageable for owner Anil Agarwal. But falling out with a government is an eyesore, particularly if he wants investors to back a potential carve-up of Anglo American in South Africa.

British Steel rescue loan is worst of bad options

21 May 2019

The UK’s second-largest steel producer may fail without state credit. Politicians can nationalise the company if they want to save thousands of jobs in a strategic sector. Or they could let the group go bust. The worst outcome is a short-term fix that bails out private owners.

Miners have a shot at earning green halo

16 May 2019

Vale’s dam disaster was a reminder of the industry’s social and environmental pitfalls. At the same time, the likes of BHP and Glencore can tout their ability to supply future low-carbon economies. ESG activists punished coal, but they’re in position to reward diggers, too.

Thyssenkrupp shoved into a panicky Plan B

10 May 2019

The German conglomerate is binning a split after weak operations hit its shares, Reuters reports. Spinning off its elevator business instead would help, especially if the EU blocks a merger of its steel arm. But Thyssenkrupp would still need to show it can cut bloated costs.

En+ chair gets relatively meagre sanctions bonus

2 May 2019

The Russian energy group has given Chairman Greg Barker $4 mln for successfully lobbying against U.S. sanctions, Bloomberg says. En+’s market value is up $1.5 bln since it avoided the strictures. Paying 0.3 pct to detoxify its business is a reasonable exchange.

Africa uprisings carry stark oil-addiction warning

12 April 2019

Veteran leaders in Algeria and Sudan have been unseated. Rising unemployment, inflation and weak growth are the immediate reasons why, but a broader common theme is too heavy a reliance on crude extraction. That’s not a problem limited to Africa.

Zambia case puts corporate ethics guff on notice

11 April 2019

Britain’s Supreme Court says Vedanta can be sued in London for pollution offences in the African state. Multinationals have tended to trumpet corporate social responsibility at head office, while ignoring sins at subsidiary level. Whatever the case’s outcome, that will change.

Oligarchs take U.S. sanctions risk in their stride

8 April 2019

The Russian owners of Evraz recently cut their stake below 50 pct, which offsets potential heat over their Kremlin links. That doesn’t mean fellow metal groups like Severstal need to follow suit. Still, Oleg Deripaska’s recent travails imply little cause for complacency.

Iron ore surge masks Vale risks

3 April 2019

A fatal dam accident in January wiped almost $21 bln off the Brazilian company’s value. It has since clawed back most of that sum, thanks in part to a jump in the mineral’s price. Given the long-term cost of Vale’s second accident in three years, the recovery looks premature.

Rare-earth bid reverts Aussie conglomerate to type

26 March 2019

After spinning off supermarkets and selling coal, $27 bln Wesfarmers is back adding to its sprawl with a $1.1 bln offer to buy Lynas. The attraction of owning the only major producer of speciality ingredients outside China is clear, but the financial and strategic cases less so.

John Paulson gives Newmont late but valid advice

22 March 2019

The gold miner’s $10 billion Goldcorp offer terms aren’t good enough for the hedge fund manager, who owns a 2.7 percent stake. He has a point – recent gold deals haven’t featured premiums. But his campaign might have gained more traction had he started earlier.

Barrick wisely decides harmony is golden

11 March 2019

The gold miner has struck a joint venture with Newmont, an $18 bln rival it earlier tried to acquire. Both sides should win. Newmont gets to pursue its own deal with Goldcorp. Barrick shareholders are spared the risk of an aggressive merger that left them with little to gain.

Viewsroom: Hostile gold diggers

7 March 2019

The three-way takeover fight involving Newmont, Barrick Gold and Goldcorp is full of aggression and big egos. Breakingviews columnists unpick the gold-mining M&A frenzy and debate whether cooler heads can prevail. Plus: China telecom giant Huawei has a public-relations challenge.

Barrick can learn from mining’s golden oldies

6 March 2019

The gold miner seems to be warming to the idea of a joint venture rather than a merger with $18 bln rival Newmont. There’s a precedent: a decade ago BHP ditched a hostile bid for Rio Tinto in favor of a friendly iron-ore tie-up. That failed, but this time can be different.

Gold miners bury a good deal under two shiny ones

4 March 2019

Newmont has rejected an $18 bln stock offer from Barrick, saying shareholders fare better in its agreed purchase of Goldcorp. But Barrick’s arguments – and bigger benefits for Newmont’s owners – hinge on the two joining forces in Nevada. Neither merger is required for that.

Vale can keep pages from departing CEO’s playbook

4 March 2019

Fábio Schvartsman has stepped down weeks after a fatal dam collapse. Waiting for prosecutors to push the issue is bad form. Safety and governance will have to become bigger priorities for the $65 bln Brazilian miner, but many strategic and operational ideas are worth preserving.

Rio Tinto lays bare the mining paradox of plenty

27 February 2019

Including a special payout, the digger led by Jean-Sébastien Jacques returned a whopping $13.5 bln to shareholders last year. Despite Rio's ample cash, risks are rising and safety problems like Vale’s will lift costs. That should keep the industry's growth ambitions in check.