The Financial Post reports in its Saturday edition that with the Barrick-Randgold and Newmont-Goldcorp mergers resetting the scale of the industry, some miners are beginning to admit that bulking up can carry quite a few benefits. The Post's Gabriel Friedman writes that this is quite a change from the disdain executives have had for such mergers, and has some industry watchers predicting a wave of combinations in 2019.
"It's not getting bigger for the sake of getting bigger," said Jason Neal, chief executive officer of TMAC Resources, which operates a mine and development properties in western Nunavut. "It's getting bigger for the sake of getting relevant."
Mr. Neal said his own company, which produced 33,000 ounces of gold in the third quarter of 2018, is not yet big enough to be included on many indexes.
That is a problem at a time when passive investment is on the rise, and equity financings are on the wane for mining companies.
For the second straight year, in 2018, the amount of equity capital raised by mining companies on the Toronto Stock Exchange and TSX Venture Exchange declined. The Post notes that the number of new mining listings on the two exchanges fell in 2018 to 55, down from 69 new listings in 2017.
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