Australian deal pipeline building – EY
PERTH (miningweekly.com) – Consolidation in the Australian gold and coal sectors is set to continue in 2015, advisory firm Ernst & Young (EY) Oceana mining and metals transaction leader Paul Murphy said this week.
Gold consolidation has been a key driver of transaction activity in Australia, accounting for 30 of the 85 Australian-target deals in 2014.
“Outside the gold and coal sectors, there has been little urgency to complete deals quickly, but we are seeing signs of momentum slowly building,” said Murphy.
“Continued weakness of the iron-ore price increases pressure for restructuring, rationalisation and refinancing, which will act as a catalyst for merger and acquisition (M&A) activity in the midtier and higher cost end of the industry.”
EY reported that 114 mining and metals deals were completed in Australia in the year to September 30, with total deal value of $4-billion. Deal volume declined by 22% and deal value increased 10% compared to the same period last year.
Murphy noted this week that only Canada posted a higher volume of deals for the first three quarters, with 167 with total deal value of $7.7-billion.
It was a similar story for most targeted countries, with Canada topping the list at 112 deals and Australia second at 85.
In Australia, gold accounted for 35% of the number of M&A transactions, while coal accounted for a further 14%.
The 83 global mining and metals sector respondents to EY’s latest capital confidence barometer also points to increasing M&A activity, with 46% expecting to pursue an acquisition in the next 12 months, nearly double that six months ago and the highest level in two years.
“We haven’t seen deal intentions and confidence this high in some years and this suggests a much more robust transactions market in 2015,” said Murphy.
The barometer showed far more mining and metals companies were now confident in the likelihood of closing acquisitions, with 60% of respondents indicating a positive view, up from 26% six months ago; the quality of acquisition opportunities also found favour with 60% of respondents, up from 34%, while 67% of respondents were also impressed with the number of acquisition opportunities, up from 42%.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation