The following research article is an extract of the quarterly State of the Market: Mining report which provides analysis into the market for mining, capital raising, mining deals and exploration.
Mergers and acquisitions in the international mining industry have averaged almost 14 significant deals announced per month over the past 18 months. The peak in deal activity came in the September quarter last year with 62 individual announcements valued at, or over, US$5 million. The recent low came in the March quarter last year when only 25 deals were announced.
In the latest quarter, the SNL Metals & Mining database, an offering of S&P Global Market Intelligence, recorded only 31 significant deals, half of the amount recorded in the September quarter and still below the 50 significant deals in the June quarter. However, the value of these deals improved to US$5.74 billion, compared with US$3.88 billion in the September quarter.
Although an improvement on the preceding quarter, the value of mergers and acquisitions in the December period was still well short of the US$8.01 billion recorded in the June quarter of 2016.
Half of the 31 significant deals announced in the December quarter were for gold assets, as shown in the table on this page, but they accounted for a value of only US$430 million. There were half as many deals for copper assets as there were for gold assets, but the overall value was much higher, amounting to a total of US$3.70 billion, fully 64% of the total. A single diamond deal, accounted for over 25% of the quarter's deal-making by value.
Companies based in South Africa accounted for 44% of the total value of significant mergers and acquisitions during the quarter, with four deals amounting to US$2.55 billion. One deal by a Russia based company, accounted for 25% of the total value, with two Chinese deals adding a further 21% share. Australian companies were the acquiring party in 11 deals but the value of these transactions amounted to only US$303 million.
Click here to read about the top mining deals in Q4, 2016.
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SNL Metals & Mining users can access the full report here.
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