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Lukas Lundin has no tricks for how to play the market, but somehow he has timed his deals impeccably.
The mining tycoon managed to sell a big gold mine for billions at the top of cycle. Then after bullion slumped 30 per cent he bought another gold project for a fraction of the original cost.
“It was some luck and some skill,” the executive said in an interview at this week’s Prospectors & Developers Association of Canada conference. Mr. Lundin said he learned his deal-making skills from his father, Adolf Lundin, who founded the $11.8-billion Vancouver- based Lundin Group, a conglomerate of mining and energy companies.
“He had a big appetite for risk,” said Mr. Lundin. One of the family’s 11 companies is called NGEx Resources Inc. It stands for “No Guts, No Glory Exploration,” a play on patriarch Lundin’s “no guts, no glory” motto.
“He was a big speculator, took big risks, sometimes maybe not calculated. Hopefully I take more risks that are calculated,” said Mr. Lundin.
Calculated or not, Mr. Lundin is an enviable position. He did not buy during the frenetic commodity boom and is now gobbling up mines and projects at seemingly bargain prices.
Over the past two years, Mr. Lundin bought Freeport McMoRan Inc.’s Candelaria copper mine in Chile for $1.8-billion (U.S.), Rio Tinto’s Eagle nickel and copper mine in Michigan for $325-million and Kinross Gold Corp.’s Fruta Del Norte gold project in Ecuador for $240-million.
“I hope I am buying at the bottom of the cycle. If I’m not, I’m in trouble,” Mr. Lundin said.
The nickel and copper acquisitions will boost production at one of his base-metal companies. The Ecuadorean project will be the cornerstone asset for a new gold company under the Lundin name.
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