Rio investors should push BHP for better terms 4 Dec 2009 Rio Tinto was in a tight spot when it agreed a 5050 iron ore venture with rival BHP Billiton despite having a larger chunk of assets. The Rio board won't do anything. So if shareholders want a better deal, they'll have to turn on the pressure.
RUSAL should face Hong Kong scrutiny 4 Dec 2009 The Russian aluminium giant's plans to list in Hong Kong could still come unstuck if the exchange doesn't give it the green light. The exchange risks damage to its own reputation if it fails to ask hard questions about the legal risks facing RUSAL's investors. Here are two.
Hochtief pulls IPO as investors stay cautious 4 Dec 2009 The German building group may have had unrealistic aspirations for the market value of a 49% share of its concessions unit. But if the equity markets were anything like frothy, the 1 bln euro deal would have gone ahead. The European market isn't ready for a rush of new issues.
RUSAL deal won’t end Russian debt woes 2 Dec 2009 The aluminium group has agreed to restructure $7.4 billion in foreign debt, paving the way for an IPO. That will be a relief to western lenders and controlling shareholder Oleg Deripaska. But foreign banks may struggle to reach similar deals with other Russian borrowers.
Lonmin valuation leaves little margin for error 16 Nov 2009 Investors have cheered CEO Ian Farmer, who took charge of the troubled platinum miner over a year ago amidst takeover interest from rival Xstrata. Fullyear results were greeted by a 9% share price rise. But a turnaround is now baked into Lonmin's valuation.
Xstrata’s deal-making prowess takes a scrape 15 Oct 2009 First Vale, then Lonmin, now Anglo American. Xstrata s dealjunkie CEO Mick Davis is wracking up a list of failed mining transactions. Withdrawing the weak approach for Anglo may be sensible, and the game for Lonmin isn t over yet. But Davis reputation is becoming less fearsome.
Rusal and Chinalco could be friends, if politics allow 8 Oct 2009 The oligarchs behind the Russian aluminium miner have to sell shares in an IPO to pay debts, and Rusal s cashrich Chinese rival might want to buy. If markets ruled, China s capital and ambition would match up well with Russia s resources. But politicians are fickle chaperones.
Xstrata faces tough choice with Anglo bid deadline 2 Oct 2009 The Swiss miner has until October 20 to make a formal offer for its South African peer. With Anglo having won investor support for rebuffing Xstrata s informal nilpremium approach, its suitor is expected to withdraw. But things aren t that simple. Xstrata has reasons to bid.
BP discovers minor giant 2 Sep 2009 The oil major called a newly discovered field in the Gulf of Mexico a giant , which could hold more than 3bn barrels of oil. For both BP and the US, it s a lot better than digging dry wells, but this field isn t likely to be big enough to move the needle for either.
China can fracture iron ore oligopoly 27 Aug 2009 Vale, BHP and Rio control twothirds of the international trade, but the world isn t scarce of iron ore. China, the biggest importer, seems determined to diversify its future supply by investing in big projects. It is ready to spend enough to get what it wants, eventually.
Rio Tinto’s Albanese survives 20 Aug 2009 After a tumultuous six months, the position of the miner s chief executive architect of the illfated deal with the Chinese looks secure. Rio has reined in its debt and is meeting operational targets. But Albanese will have to work to overcome the legacy of past mistakes.
Xstrata can live without Anglo American 19 Aug 2009 The Swiss miner s push for a merger with its South African rival inevitably raises questions about its standalone prospects. A deal does have merit. But Xstrata is nicely exposed to economic recovery as it is. The question is whether that s enough to keep management interested.
China’s Fortescue deal not an iron ore victory 17 Aug 2009 The People s Republic publicly insists the 35% price cut agreed with the Australian miner should be a reference for settling China s remaining benchmark contracts. But this deal came with a $6bn financing for the mining upstart. Larger rivals BHP, Rio and Vale won t be impressed.
Cheap oil has become expensive 13 Aug 2009 Brent benchmark crude should be cheaper than its West Texas Intermediate rival, because WTI is easier to refine. But Brent is now selling for around $3 per barrel more, almost the widest gap this year. The explanation: US regulatory scrutiny and changing consumption patterns.
China steps back in Rio Tinto spy case 12 Aug 2009 After various Chinese channels alleged espionage against four of the miner s employees, formal arrest on suspicion of commercial bribery is a climbdown. China could be trying to depoliticise the case. But months of uncertainty still lie ahead.
Rio case tests Chinese legal system 11 Aug 2009 Under Chinese law, the July 5 detention of four Rio executives has to be officially approved, and explained, by this week. It s a chance for China to show it s willing to follow its own rulebook and for the miner to get some idea of how serious the charges against it are.
Xstrata puts little extra pressure on Anglo 4 Aug 2009 The Swiss miner is using its decent H1 results to reassert its credentials as a merger partner for Anglo American. Cost discipline and safety improvements suggest that anything Anglo can do, Xstrata can do better. But Xstrata will still need to pay a premium if it wants a deal.
BHP’s new chairman may need new style 4 Aug 2009 Jac Nasser would be an obvious choice to supervise a company in trouble. Ford s former boss likes to shake things up. But at BHP, he may need to be emollient. Happy investors don t need drama, while governments concerned about commodity prices will test his diplomatic skills.
Anglo American bolsters defences 31 Jul 2009 Facing unwanted merger interest from rival Xstrata, the miner needed a boost. Its interim update was never going to be stellar. But it shows hard progress on cost cuts and growth projects. That gives credence to Anglo s claim to be entering a period of enhanced value creation.
Rio Tinto stuck at Chinese road-block 28 Jul 2009 It s hard to negotiate with a government that has arrested four of your employees. That s where the miner stands. It can t settle iron ore contracts with its largest customer, which is statecontrolled. Nor can it be sure of approval for a tieup with BHP that would raise $5.8bn.