The Globe and Mail reports in its Monday edition that the head of the world's third most-valuable gold company says he feels no pressure to jump into merger-and-acquisition transactions, despite larger rivals Barrick Gold and Newmont Mining striking multibillion dollar deals.
The Globe's Niall McGee quotes Sandeep Biswas, chief executive officer of Melbourne-based Newcrest Mining, as saying: "Getting bigger for bigger's sake, I've never been a big fan of that. There's either got to be real synergies, or real technical or other capabilities, where one can enhance the combined entity."
After seven years of deep cost-cutting, writedowns and asset sales, there are signs the tide is turning in the beaten down global gold sector. The biggest gold mining companies have started to do large acquisitions again, with Barrick and Newmont paying $16-billion combined to sweep up rivals Randgold Resources and Goldcorp, respectively. The recovery in the price of gold bullion over the past few months is adding to the optimism.
However, even with Barrick and Newmont getting bigger through acquisitions, the gold industry remains far more fragmented than it was a decade ago, with significantly fewer large capitalization producers.
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