Mining M&A: Domestic And International Diligence

When contemplating any merger or acquisition, a diligence review is one of the preliminary steps an acquiring company takes to fully understand what they are purchasing beyond the underlying asset. In mining transactions specifically, this diligence process can involve agreements or considerations that are unique to this industry and may extend across international borders. Two of these unique differences, mainly the use of indigenous mining agreements and the potential for domestic liability as a result of operations abroad, are becoming commonplace in the industry and are no longer outliers. With deal volume in mining M&A reaching its highest levels since 2014, the likelihood of a potential target being subject to one or both of these matters is high. It is important to become familiar with these beforehand to prevent getting lost in the weeds of a potential transaction.