LIM Advisors seizes opportunity to invest in distressed Asian-Pacific miners
LIM Advisors is looking to position itself to take advantage of opportunities created in the Asia-Pacific mining sector as commodity prices continue to crumble. The Hong Kong-based hedge fund has earmarked $120 million to invest in distressed mining and mining services companies over the next year.
The company views distress as an opportunity, particularly in the mining industry where equity investors have been scared off due to declining commodity prices. LIM Advisors' founder and CEO, George Long, believes it will only get worse before it gets better.
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He told the Australian Financial Review: "There will be a mining and mining services industry in some form at the end of the day, even at the bottom of the cycle...it's not possible in the modern economy to not have a mining industry. But we'll see a lot of consolidation. Junior minors will get wiped out, BHP and RIO will go on.”
According to AFR, the company will use the capital to fund rights issues, convertible stock deals and debt buyouts. In addition, the company will invest in Asia including in Japan and in Chian’s A Shares and H Shares market through its multi-strategy hedge fund.
Long believes China’s economy slowdown will push more companies in the mining and resources segment to the brink. "It's getting worse, we are still in the down turn phase."
Founded in 1995, LIM manages roughly $2 billion in institutional capital and is one of Asia’s largest and oldest hedge funds.
Newmont acquires Canada’s GT Gold in $325mn deal
Newmont, the world’s biggest gold miner, has acquired Canada’s GT Gold in a deal worth $325mn. The gold giant now controls the Tatogga gold-copper project in the Traditional Territory of the Tahltan Nation.
“With the acquisition of GT Gold and the Tatogga project in the highly sought-after Golden Triangle district of British Columbia, Canada, Newmont continues to strengthen our world-class portfolio,” commented Newmont President and CEO Tom Palmer.
“We look forward to continuing to build a respectful and meaningful relationship with the Tahltan Nation, including the community of Iskut. The relationships we have with Indigenous communities, First Nations and host communities are critical to the way we operate. We will partner with the Tahltan Nation at all levels, and with the Government of British Columbia to ensure a shared path forward as the Company understands and acknowledges that Tahltan consent is necessary for advancing the Tatogga project.”
Newmont’s acquisition includes the Tatogga project, comprised primarily of the Saddle North deposit, which has the potential to contribute future significant gold and copper annual production. There are also further exploration opportunities beyond the known deposits at Saddle North within the land package. The Tatogga project adds to Newmont’s existing interest in the prospective Golden Triangle through the company’s 50% ownership in the Galore Creek project.
Newmont is the world’s leading gold company and a producer of copper, silver, zinc and lead. A world-class portfolio of assets, prospects and talent is anchored in favourable mining jurisdictions in North America, South America, Australia and Africa. The American miner is celebrating its 100th anniversary this month.
With gold prices on the rise, the last six months has seen gold industry M&A activity accelerating. A recent Mckinsey report, advises that the industry need to be mindful of mistakes made during the previous gold price boom, when growth was chased unidirectionally by several companies.