Today we are publishing a thematic report on African Gold M&A entitled The Market is Open. In this report we take a look at the past, present and future for M&A activity in the African gold space (excluding South Africa). We review M&A activity over the past ten years to provide some context, we assess the current strategies and financial position of some of the likely acquirers and review some of the possible targets with a view to anticipating where future M&A could take place.
We believe that the time is right for more M&A activity. Although M&A got itself a bad name as the result of over-enthusiastic prices being paid for assets at the top of the cycle, it remains a mechanism through which companies both build their businesses or transform their status. We see this as being of particular significance in the current market conditions, where the lack of gold price volatility and the reduced ebb and flow of capital into the gold sector provides a high level of transparency on companies’ activities.
We believe that in this environment, the ‘Urge to Merge’ is a current theme of company strategy and that this will be reflected in M&A activity over the coming year as companies look to attract the attention of the pools of capital that remain interested in the sector, which appear to have become more and more concentrated. Times change, however, and we suspect that the gold price volatility will increase over the coming years and that this will result in a change of shareholder demands, in response to which company strategy and M&A activity will continue to adapt. In any event, the Market is Open.
For further information please contact RFC Ambrian directly