Mark Bristow’s tenure as boss of the world’s biggest gold miner might have been short-lived, but his message for smaller rivals just got even more pointed.
“Holy camoly, I missed out on a great opportunity!” is how Bristow described anyone not involved in Barrick Gold Corp.’s purchase of Randgold Resources Ltd. in September. With Newmont Mining Corp. poised to become the No. 1 producer through a $10 billion takeover of Goldcorp Inc. announced Monday, the pressure on those left behind will be even greater.
The two mega deals promise to transform the industry that many investors have shunned due to floundering bullion prices and poor decision making by producers. The newly combined companies are also expected to put several unloved assets up for sale, leaving lots of room for maneuvering by those that missed out on the dealmaking so far.
“Somebody has to buy those, so there’s obviously going to be more consolidation of those assets into existing vehicles or potentially new vehicles,” Goldcorp Chief Executive Officer David Garofalo said in a phone interview.
“Both Barrick and Newmont Goldcorp still represent only six or seven percent of global mine supply, so it’s still a very fragmented industry and I think investors are rightfully demanding that there’s a bit more consolidation.”
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