Mick Davis is cash heavy and hunting for mining deals – maybe in Canada – by Eric Reguly (Globe and Mail – March 31, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

ROME — The new company set up by Mick Davis and other former Xstrata executives, X2 Resources, has raised $2.5-billion (U.S.) in funds and is set to buy mining assets in the belief that the commodities cycle is set for a revival.

X2 announced Monday that it had secured the commitment from five investors, each of which have contributed $500-million. The same five have have agreed to contribute another $1.25-billion in conditional equity funding, raising the potential total to US$3.75-billion.

The identifies of only two of the five investors, Noble Group and TPG, have been disclosed. Noble Group, based in Hong Kong and listed on the Singapore exchange, is one of the world’s largest commodities trading and infrastructure companies. It competes with Switzerland’s Glencore, the new owner of Xstrata. Mr. Davis was CEO of Xstrata until early last year.

TPG is a private American investment firm, with more than $55-billion in assets under management in a broad range of businesses, from energy to biotechnology.

The other three investors include sovereign wealth funds and pension funds. In an interview in London last autumn, Mr. Davis said Canadian pension funds were potential investors in X2. The company would not confirm or deny that Canadian money was part of the $2.5-billion raised so far.

In a statement, Mr. Davis said “We believe the timing of this venture remains very opportune and we will now focus increased attention on starting the investment process.”

X2’s goal is to create mid-tier mining and metals group but has yet to make an investment. The company consists of a small office in central London and five executive partners, all of whom are Xstrata refugees. They include Trevor Reid, who was Xstrata’s finance director, Thras Moraitis, Andrew Latham and Ian Pearce. Mr. Pearce, of Toronto, was the CEO of Xstrata Nickel, formerly Falconbridge, the Canadian nickel miner bought by Xstrata in 2006 for about $22-billion (Canadian).

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