Cambior Holds Merger Talks With Rivals as Gold Prices Stay Low
Cambior Holds Merger Talks With Rivals as Gold Prices Stay Low
Montreal, Aug. 19 (Bloomberg) -- Cambior Inc., Canada's fourth-largest gold miner, is holding merger talks with rivals, the company's chief financial officer said.
In April, TVX Gold Inc. rejected a merger proposal from Cambior, which is based in Montreal. Cambior is still seeking partners. ``We certainly want to be one of the active members of this consolidation,' Henry Roy said in an interview. ``We are pursuing discussions with a handful of potential transactions that would help to consolidate the industry.'
He declined to say whom Cambior is talking to.
The company will keep focusing on projects in North America and South America, he said. ``The Americas have been our principal area of focus from a regional point of view, so that's the most natural area for us to expand.'
Weak commodities prices have already prompted a wave of mergers and acquisitions in the oil, forestry, copper and aluminum industries. Gold, which has fallen to 20-year lows this year, is the next industry to see activity, analysts said. ``We're going to see many more deals still,' said Robert Van Doorn, an analyst at Loewen, Ondaatje, McCutcheon Ltd. who rates Cambior a ``buy.' ``In the current market circumstances if you're too small, you'll languish.'
Possible merger candidates could be Battle Mountain Gold Co., the No. 4 U.S. gold producer, which is currently seeking a chief executive, and Greenstone Resources Ltd., a Canadian gold producer that has been struggling to pay back debt, Van Doorn said. Both companies have mines in Latin America.
Cambior, which expects to produce 630,000 ounces of gold this year at an average cost of about US$215 an ounce, has projects in Quebec, Argentina, Peru, Guyana, Arizona and Mexico. |
