Timeline: Mining M&A deals

Latin America saw a string of major mining M&A deals in 2019, with industry experts forecasting further consolidation next year.

Large mergers and acquisitions – worth US$500mn or more – targeting primarily Latin American assets totaled US$14bn over the past 12 months, according to figures compiled by BNamericas.

The figure was dominated by the US$10bn Newmont Mining-Goldcorp merger. Goldcorp’s Latin American mines accounted for half the company’s total output in 2018.

Pan American Silver, Lundin Mining, Sumitomo, Equinox Gold and Leagold Mining were among the other miners announcing large merger or asset acquisition deals during 2019.

TIMELINE

January: Barrick Gold begins trading after completing its acquisition of Africa-focused Randgold Resources.

February: Pan American Silver completes its acquisition of Tahoe Resources in a deal worth more than US$1bn.

March: Newmont Mining rejects a takeover bid by Barrick Gold calling it egocentric.

March: Barrick Gold and Newmont Mining create a gold JV in Nevada targeting US$5bn of synergies over 20 years.

April: Teck Resources sells a 30% stake in the Quebrada Blanca Phase 2 copper project in Chile to Sumitomo Metal Mining and Sumitomo Corporation for US$1.2bn.

April: Yamana Gold agrees to sell its Chapada mine in Brazil to Lundin Mining for US$1bn.

April: Newmont Mining and Goldcorp secure approval from Canadian investment authorities for a US$10bn merger.

June: Brazil antitrust watchdog Cade approves Vale’s US$500mn acquisition of iron ore miner Ferrous Resources.

July: Calibre Mining announces a deal to acquire B2Gold’s Nicaraguan mines and projects for US$100mn.

July: Yamana Gold completes the US$1bn sale of its Chapada mine in Brazil to Lundin Mining.

October: Calibre Mining completes the US$100mn acquisition of Nicaraguan gold mines and projects from B2Gold.

December: Equinox Gold and Leagold Mining announce a merger worth about US$584mn.

OUTLOOK

The mining sector is primed for further strong M&A activity in 2020, with dwindling global mine supply and a shortage of high-quality projects among the factors favoring further deals.

“From a macroeconomic perspective and from investor and industry willingness perspective[s], this looks like the start of a real phase of consolidation,” CRU Group director Paul Robinson told Kitco News earlier in December.

Mergers can also provide much-needed liquidity boosts – while lowering overheads – as shown in the proposed Leagold Mining-Equinox Gold transaction.

Company size, portfolio diversity and strong liquidity are among the key factors at play in attracting investment, Leagold CEO Neil Woodyer told BNamericas this month.

Others in the sector agree.

More mining consolidation is still needed, especially in the gold sector, Barrick CEO Mark Bristow told Bloomberg – which put 2019 deals in the global gold space alone at US$33bn.