Australia’s gold miners have a remarkable ability to wheel and deal their way to riches. Newmont’s re-entry to the ranks restarts the race.
A Cup Day listing ceremony signals the dawn of a new era in Australian mining, which should be defined by gold sector M&A and a scramble for size and operational synergies.
History says it will be an active few years of corporate M&A activity ahead, and the chasing pack will have a few former Newcrest and Newmont assets to chew on, should they want to grow quickly.It has $20 billion in CDIs on the ASX, and is the biggest, most liquid way to play listed gold miners in Australia. Will its new Australian investors stick around? These sorts of listings can be transitory, but that is a question for another day.
But history says the pecking order will not stay that way for long. Australian gold miners have a remarkable ability to wheel and deal their way into bigger and more liquid listings, often combining with rivals before falling to a global major like Newmont, Barrick Gold or Agnico Eagle. Newmont has promised to offload some of its newly acquired portfolio, with Palmer saying the group wanted to find $US2 billion .Gold miners reckon Newmont’s done the rounds of Perth’s St George’s Terrace in the past fortnight. The miners left meetings with the clear impression that two of the Newcrest mines, Telfer and nearby development project Havieron, would soon be on the block.
Newmont’s Palmer has flagged he wants to raise about $US2 billion from mine sales and project divestments, which means there is sure to be other assets up for grabs., although heading to North America is a cautionary tale for Australian gold producers. Few have found that trip worthwhile.Indeed, Australia’s gold industry has changed a lot in the past 30 years or so.
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