Metals

Gold surge adds glitter to tarnished miners

31 Oct 2024

The yellow metal is up 35% this year as investors fret about inflation. Gold miners like Newmont and Barrick have repeatedly failed to capitalise on the ore’s rising value. But new-found financial discipline and modest valuations present investors with a rare opportunity.

BHP’s dam disaster dealings leave a bad taste

21 Oct 2024

The miner and partners are offering Brazilian authorities $23 bln in damages for a 2015 catastrophe, but with most of it paid over 20 years. And BHP was in hot water trying to hinder a related $47 bln lawsuit in London. Both take the argument of protecting shareholders too far.

Rio’s $6.7 bln lithium bet is a pricey slow burn

9 Oct 2024

The $112 bln miner is paying a 90% premium to buy Arcadium in cash. That’s probably not justified by the synergies – and Rio Tinto has yet to reveal them. Boss Jakob Stausholm can point to forecasts of a lithium demand surge, but right now investors have to take his word for it.

Hong Kong economic pain is marginal gain for LME

4 Oct 2024

Port activity and land prices have fallen so far that the London Metal Exchange is eyeing warehouses in the financial hub. That may spur more Chinese buyers to use the bourse. But despite more than a decade of Hong Kong ownership, storage in mainland China remains out of reach.

US Nippon Steel rebuff would be cruel and kind

10 Sep 2024

Washington may block the Japanese company's $15 bln takeover of US Steel. It'd be a blow to Nippon's plans to offset growth challenges at home and overcapacity from China. But it has other options that may eventually yield better returns than it could extract from its US target.

Glencore may be the next UK listing to head west

7 Aug 2024

The $61 bln miner had planned to spin off its coal unit via a New York IPO. Given the pollutant’s profit remains alluring, it now won’t. But Glencore boss Gary Nagle could weigh up US investors’ greater fondness for fossil fuels, and opt to move the whole company instead.

Anglo American has a job to exit post-BHP hole

25 Jul 2024

The $38 bln miner unveiled better-than-expected half-year earnings. But after fending off his Australian suitor, Anglo boss Duncan Wanblad has to give impatient investors good news on his self-help plans. Coal and diamond headaches make that increasingly hard to do.

Copper’s green step change is an uphill struggle

9 Jul 2024

Supplies of the red metal have to motor if the world is to adequately decarbonise. In this Exchange podcast Tae-Yoon Kim, senior energy analyst at the International Energy Agency, lays out the challenges that need to be overcome if the private sector is going to make that happen.

Anglo American’s revamp has an inauspicious start

1 Jul 2024

The easiest part of the $41 bln group’s overhaul after BHP’s takeover bid was a sale of its coking coal business. A months-long closure of that unit’s most profitable mine may make an expected $5 bln valuation harder to achieve. That increases the pressure on CEO Duncan Wanblad.

Miner M&A spotlight may shift to Teck and Freeport

27 Jun 2024

BHP’s failed pitch for Anglo American leaves a vacuum for keyed-up mining bankers to fill. Canada’s $25 bln Teck and $70 bln US rival Freeport-McMoRan both offer purer-play copper options. Either could become targets for bigger fish, or even drive consolidation themselves.

Mining M&A stokes coal race against cleaner power

20 Jun 2024

Anglo American will soon offload dirty deposits used to make steel as part of CEO Duncan Wanblad’s overhaul. Rival sales suggest there should be plenty of suitors. Coking deals can pay off for buyers if prices stay high and green options develop slowly, but neither is assured.

Failed Anglo bid is net negative for BHP CEO

29 May 2024

Mike Henry has ditched the Australian miner’s $47 bln attempt to buy its UK-listed rival. He misjudged the difficulty of pushing Anglo to divest South African assets. But he avoided upsetting investors by overpaying, and if his target’s breakup plan falters he can try again.

Copper’s M&A mania obscures a dysfunctional market

23 May 2024

The red metal is the main driver of BHP’s $46 bln bid for Anglo American. But despite expectations that the energy transition will boost demand, prices are still too low to tempt miners into expanding production. Mergers may help break the deadlock, but aren’t certain to do so.

BHP boss hopes a week is a long time in dealmaking

23 May 2024

Mike Henry has won an extra seven days to try to seal a deal with Anglo American. The trick will be to persuade his harried quarry that its own breakup plan is more risky than BHP's three-step approach. It's a battle of egos, and may yet require upping the $46 bln proposal.

BHP may have to channel Glenstrata to snare Anglo

22 May 2024

The UK-listed miner has rejected the Australian giant’s latest $46 bln offer. Glencore’s 2012 swoop on rival Xstrata produced annual synergies of more than $2 bln. To offer more for Anglo American without hurting his own investors, BHP boss Mike Henry may need something similar.

New Caledonia to Macron: it’s the economy, stupid

20 May 2024

Deadly riots prompted the French president to impose a state of emergency in the Pacific Ocean territory, which holds 5% of world nickel reserves and gives Paris a strategic outpost in the region. To revive the island, a new economic deal would work better than an army crackdown.

Anglo breakup gives investors a free option on M&A

14 May 2024

The $40 bln miner plans to offload coal, diamond, nickel and platinum assets to help fend off takeover interest from BHP. The standalone strategy may be worth more to shareholders than what its Australian suitor proposed. Yet if it flops, a future takeover might be even easier.

BHP-Anglo impasse more about structure than price

13 May 2024

Anglo American spurned an improved $43 bln bid from its Australian rival. A key obstacle is that BHP wants its target’s investors to bear the risks attached to spinning off unwanted South African units. CEO Mike Henry can remove it by making an offer for the whole company.

Rio Tinto may be dark horse in BHP-Anglo saga

10 May 2024

The $120 bln miner may yet crash the Big Australian’s $39 bln merger. Still, if BHP does win Anglo and Glencore is busy integrating its $7 bln Teck deal, Rio’s key mining rivals will be distracted. That may give CEO Jakob Stausholm a clearer run at the likes of First Quantum.

Clash of the mining titans will get more bruising

2 May 2024

Australian giant BHP’s $39 bln swing for Anglo American is a contentious, complex land grab for the metals key to a renewable future. In this Viewsroom podcast, Breakingviews columnists discuss the political and financial hurdles, and why this M&A contest has a way to run.