Stung by some lousy investments that led to billions of dollars in losses a few years ago, the world’s major gold producers have cut way back on mining deals — even as metal prices posted their biggest rally since 2010.
The value of the industry’s transactions, from acquisitions to venture-capital financing, tumbled by more than a third in 2017 to $8.95 billion, the lowest in at least a dozen years of data compiled by Bloomberg.
The decline reflects the skittishness of an industry that went on a buying spree in 2010 and 2011, when prices surged to records, and then got stuck with too much debt and huge writedowns after bullion tumbled.
While prices are up over the past two years, executives are reluctant to start buying again. Shareholders harshly criticized past deals, which billionaire hedge-fund manager John Paulson estimates led to $85 billion of writedowns since 2010.
Bullion remains about 30 percent cheaper than its record in September 2011, but over the same period, shares of major mining companies tracked by Bloomberg Intelligence fell even more, by more than half.
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