It’s game on in big mining M&A.
BHP’s bid for OZ Minerals has lit the fuse for a wave of large-scale deals, with fund managers tipping BHP’s big rivals including Rio Tinto and Anglo American to follow suit with deals of their own.
Copper is one of four minerals the IMF says will benefit from seeking to hit net zero emissions by 2050.History says when one of the big miners starts opening the purse strings, the others cannot resist the temptation. Influential institutional investors switch from talking about capital returns and discipline to empire building and growth, and the miners’ big corporate development and investment bankers are only too happy to oblige.was a good place to start.
Activity, as BHP showed, is expected to centre on anything that can help future-proof of miners’ portfolio and fuel their longer-term shift into green metals required for EV batteries and electrification more generally. BHP obviously likes copper and nickel , while Rio Tinto seems more focused on lithium. And the shopping list’s likely to be tier one assets in well-known mining jurisdictions.
Fundies reckon Australia’s third-force, the $60 billion Fortescue Metals, is less likely to get involved. It’s spewing off cash, but has Fortescue Future Industries to feed and a founder who did very well to get his company into a strong financial position and maintain his own significant stake.Should OZ Minerals be the start of a wave, as tipped, it would be good news for bankers, who are already staring at record levels of completed MA in Australia this year.
co-edits Street Talk, specialising in private equity, investment banking, M&A and equity capital markets. He has 10 years' experience as a business journalist and worked at PwC, auditing and advising financial services companies.