Mining Industry Trends – Strategic Investment Transactions

The combination of macroeconomic uncertainty and speculation over trade wars has not been kind to commodity prices or the mining industry lately.  The impact has been especially felt among junior companies without producing assets, as financiers and the public capital markets are reluctant to take on exploration or development risk with their investments in the face of broader uncertainty.  Fortunately, for companies with compelling exploration projects there is a silver lining, as major mining companies are reviewing their mineral reserve/resource portfolios and project pipelines and starting to reinvest after almost a decade of fiscal restraint.  While there is continued reluctance to be overly aggressive with acquisitions (financial discipline is still top of mind for the majors), there have been a number of strategic investment transactions involving major companies acquiring significant minority equity stakes (5% to 19.9%) in junior exploration companies.  These