Metals

EU-US steel unity may come at a high cost

19 Oct 2023

Europe could soon join the United States in whacking tariffs on other alloy producers. EU leaders and Joe Biden may want to shield firms like ArcelorMittal from Chinese imports. But helping the 130 bln euro industry could weaken global trade rules, and the bloc’s climate policy.

Tycoon’s lithium grab leaves investors hanging

16 Oct 2023

Billionaire Gina Rinehart has stifled Albemarle’s $4.2 bln bid for Liontown with deft use of Australia’s takeover rules. Now the minerals producer has to raise cash just as prices for the key battery material are falling. She needs to show why her spoiling tactics were worth it.

Asia’s breakup party is happening under duress

4 Oct 2023

India’s Anil Agarwal is splitting his $10 bln mining company Vedanta into six. As with China’s Alibaba, the carve-up is spurred by external problems, namely debt at its unlisted parent. Tycoons are unlocking value for weary shareholders, but mostly because they have no choice.

M&A spillover in India-Canada fight hurts everyone

22 Sep 2023

As bilateral relations sour over a murder, tycoon Sajjan Jindal is going slow on his planned $8 bln consortium bid led by JSW Steel for Vancouver-based Teck’s coal assets. The stalling hurts the buyer and the seller, and India’s diversification ambitions a bit more.

China may finally nick some metals clout from LME

20 Sep 2023

Beijing has long been trying to erode Western dominance in the pricing of key commodities. Shanghai’s plans for a nickel contract could hurt the London venue’s benchmark status as it reels from a trading scandal. Yet building the necessary global warehouse network will take time.

Fortescue founder toys with reverse greenwashing

1 Sep 2023

Andrew Forrest has lost a CEO, a CFO and a top adviser this week. The tycoon says people only quit his $43 bln miner if they disagree with its zero emissions goal. Change and the energy transition can be disruptive. But his absolutist twist to climate spin homes in on a new risk.

Fortescue’s biggest problem sits at the top

28 Aug 2023

The $41 bln Australian iron ore miner is parting ways with CEO Fiona Hick after six months. Hers is the latest in a slew of senior departures that reflect poorly on founder and chair Andrew Forrest. Shareholders can accept he’s becoming a liability, push for his removal, or sell.

BHP’s dividend cut is canary in ore mine

22 Aug 2023

Boss Mike Henry is talking up the $140 bln miner’s ability to withstand everything from lower commodities prices to China risks. He has a point. But shareholder payouts have fallen to 64% of earnings from last year’s 77%. It suggests some steeling for short-term global shocks.

US Steel should hold out for a better deal

21 Aug 2023

The world’s first $1 bln company has rejected a $7 bln takeover bid from rival Cleveland-Cliffs. The suitor is touting union support that could short-circuit a broader sale process. A merger makes strategic sense, so much so that the target’s shareholders deserve more.

China woes put global miners’ optimism to the test

21 Aug 2023

BHP boss Mike Henry and Fortescue peer Fiona Hick have remained bullish on the People’s Republic even as the country’s economy, and their own shareholders, waver. Absent Beijing unveiling a big stimulus package, the CEOs are likely to have to revise their enthusiasm.

Saudi pays rich but logical price for Vale metals

28 Jul 2023

The kingdom is buying one-tenth of the $66 bln Brazilian miner’s nickel and copper arm. The $26 bln valuation on Vale’s base metals unit is steep, but cheaper than a full takeover. It also acts as a down payment on Saudi’s efforts to become an energy transition industrial hub.

Capital Calls: European steel

21 Jul 2023

Concise views on global finance: Sweden’s $6 bln group SSAB misses profit forecasts as Europe’s demand tanks and steel prices shrink.

Recycling fail exacerbates EU’s metals conundrum

7 Jul 2023

The bloc is likely to miss a target to double its use of recycled material by 2030. That’s especially short-sighted given the growing threat of Chinese export restrictions on critical metals. Improving Europe’s ability to mine junk would help shield key EU industries.

China’s rare metals swipe has more bark than bite

4 Jul 2023

Beijing is imposing export controls over gallium and germanium, used in chips, fibre optics and military equipment. This confirms Western fears that the country might leverage its strategic metals dominance to push back on sanctions. Yet market realities blunt China’s edge.  

Capital Calls: London crypto move, Stellantis SPAC

12 Jun 2023

Concise views on global finance: British Prime Minister Rishi Sunak welcomes Andreessen Horowitz’s UK office just as cryptocurrencies face a regulatory crackdown in the US; the European carmaker’s move to back a London blank-check vehicle is less hairy than it sounds.

Lithium miners unearth shovel-ready $11 bln deal

10 May 2023

Australia’s Allkem and US peer Livent are uniting to create an energy-transition titan. EV makers scrambling for battery materials should like a combined explorer and processor with no Chilean exposure. Bigger is strategically better, and helps the merger stack up financially.

Glencore’s best Teck tactic is a surgical strike

28 Apr 2023

The Swiss commodities giant has little room to sweeten its $23 bln offer for the Canadian miner without hurting its own shareholders. It can, however, afford a disproportionately higher premium to the controlling Keevil family. Common-stock owners would have to see the upside.

Chile’s lithium grab puts foreign miners on notice

21 Apr 2023

President Gabriel Boric will force producers of the EV battery metal to be junior joint-venture partners to the state. Foreign miners expected a tax hike, and global lithium supplies are diversifying. But Boric’s gambit means copper players like BHP will wonder if they’re next.

Glencore Teck tweak is necessary, not sufficient

11 Apr 2023

The Swiss group’s $23 bln offer for the Canadian miner now includes up to $8 bln of cash. That means its target’s shareholders can avoid taking payment in dirty coal shares. But Glencore may still have to raise the value of the overall bid to bring Teck investors on side.

Capital Calls: IMF’s grim outlook, Electric cars

11 Apr 2023

Concise views on global finance: The International Monetary Fund’s medium-term forecast for the global economy is the bleakest since 1990; lower proposed mileage ratings for electric vehicles could force automakers to sell more of them to meet regulatory standards.