Mining

Xstrata buys back 10% of its shares

12 Aug 2004

It is a good time to be miner, especially one with mediocre assets. Xstrata would like to grow, but does not want to buy at the peak. It is starting to act as if it thinks the good times will last. But don't imagine that the mining group's expansionary management has abandoned acquisition ambitions. The buyback is reversible. And Xstrata thinks the commodity price boom will endure. So it's probably only a matter of time before it's sniffing out another big deal.

Commodities not entering a new paradigm

13 Jul 2004

Sure, prices are up. But the move is cyclical. As always, today s higher prices will lead to higher investments, and then to lower prices. Optimists are starting to say that this time will be different. But they underestimate the power of innovation.

Newmont merger talk may be fool’s gold

7 Apr 2004

Rumours of a Newmont bid for Canadian rival Barrick are persistent. And there is some logic to a deal. But Newmont should not let the frenzy of the gold market get in the way of good sense a Barrick takeover would be too expensive.

Gold bugs are on the G7 lookout too

4 Feb 2004

It increasingly looks as though the G7 won t muster any more support for the dollar this weekend than they did last November. If the dollar resumes its fall, the dollar price of gold would soar and, for the first time, rise in other currencies too.

Vedanta IPO shows volatility of mining stocks

1 Dec 2003

The Indian miner is due to float in December near the peak of the cycle and valuation ranges are huge. That makes investors lives harder, but is par for the course for the sector, which can trade at between 0.5 and 2 times NAV over the cycle.

Vedanta has all the makings of a hot IPO

21 Nov 2003

The Indian miner pushes many of the right buttons. It s a commodity play and it offers Chineselike growth, only without the communism. But whether investors should pay a premium for this is debatable. A luminarypacked board can t erase all corporate governance concerns.

AngloGold tightens its grip on Ashanti

15 Oct 2003

But AngloGold has the firm support of Ashanti s largest investor, Lonmin. Randgold looks outmanoeuvred. The South African miner has upped its $1.4bn bid. This may not be a knockout offer. It s still lower than Randgold s.

Rhodia CEO forced out

3 Oct 2003

The company needs their backing if it is to put its finances on an even keel. About time too. JeanPierre Tirouflet had lost the confidence of investors.

Randgold goes hard on $1.8bn Ashanti offer

24 Sep 2003

Rising gold prices have done wonders for Randgold s share price, and its audacious reverse takeover offer for the Ghanaian group. In just six weeks, the value of its bid has increased by a quarter, while Anglogold s rival offer has risen by less than 15%.

BHP rides high on economic recovery hopes

28 Aug 2003

Mining stocks have been among this year's best performers. Hopes of a global recovery and frothy commodity markets have lit up share prices. But the rises have come too far, too fast. Valuations now leave little margin for error.

Randgold makes indicative offer for Ashanti

11 Aug 2003

The UKbased gold miner has offered a bigger premium than rival suitor AngloGold. But the financing of the bid looks flaky. The bid battle is about political concessions as much as value. Ghana s government will have a big say in who walks off with the prize.

Xstrata wins MIM by a whisker

6 Jun 2003

The UKSwiss miner s bid for its Aussie rival is all over bar the shouting. Xstrata needed 50% of MIM shareholders and got 59%. Opponents may try to block the deal on the grounds that hedge funds increased their votes by splitting their holdings. That may backfire.

Xstrata arbs are still in with a chance

27 May 2003

Forget the creation of shareholder value. The UK miner s rights issue to fund the takeover of MIM shows the value of shareholder creation. If the arbs can find a way to create thousands of new MIM shareholders, they will profit from buying the traded rights on the cheap.

MIM agrees $2.96bn Xstrata offer

7 Apr 2003

The takeover builds the world's largest thermal coal producer, and diversifies Xstrata away from coal and its South African base. It will also earn over Xstrata's cost of capital, it says. Add a bigger, more geared free float, and no wonder shareholders are pleased.

BHP gains greater control over BHP Billiton

6 Jan 2003

The shock departure of CEO Gilbertson due to "irreconcilable differences" weakens the role of the old Billiton. The new CEO, Goodyear, is an exBHP man. He has solid credentials. But investors in the UK arm may worry power is shifting to Australia.

Inefficient Market: The case for gold

12 Sep 2002

Book of gold

30 Jul 2002

Heard in Europe: What gold & UK football have in common

7 Jun 2002

Mining for dollars

21 Feb 2002

Kangaroo split

26 Nov 2001