Large base metals & gold acquisitions drop by 66 per cent: MEG
With the rapid onset of the worldwide recession in late 2008, marked by sharp drops in commodity prices that continued well into 2009 - especially among base metals – acquisitions activity almost ground to a halt.
According to Metals Economics Group’s (MEG) recent Strategic Report, the 2009 volume of large acquisitions decreased by 66 per cent from 2008, the third consecutive annual decrease in acquisitions spending since the historical high in 2006. Although in nominal terms the 2009 total was still the fifth-highest annual total in the past ten years, the steep year-on-year drop from 2008 is slightly more than the 65 per cent decline from 2001 to 2002, at the bottom of the cycle.
Data analysed from MEG’s Base Metals and Gold Acquisitions services shows a 79 per cent plunge in base metals acquisitions spending from just over $32 billion in 2008 to just under $7 billion in 2009, the largest year-on-year decline in base metals spending since 1990. In contrast, 2009 gold acquisitions decreased by a relatively mild 18 per cent, from almost $9 billion in 2008 to just over $7 billion.
Of the 31 base metals transactions considered in 2009, Australia-Pacific was by far the richest regional target in 2009 in terms of in-situ value acquired, with seven transactions totalling almost $113 billion in in-situ value – 38 per cent of the US$290,278 million total value acquired. Africa was second with five deals totalling almost $63 billion in value. Of the 43 gold acquisitions, Africa, with 28 per cent of the US$95,152 million in-situ total value acquired, had six transactions containing $26,642 million of resources in the ground.
MEG’s Base Metals and Gold Acquisitions services give clients a competitive edge by reporting and analysing current and historical transactions involving advanced-stage base metals and gold projects, operating mines, and companies. For more information visit: www.metalseconomics.com
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