RE:Buyout Price Estimate As a follow up to my own post, I did a little digging around and asked ChatGPT some questions regarding this. For all interested parties I've included its responses below.
I asked, "Can you find examples specific to a Canadian mine being bought out?"
It wrote, "Yes, there have been several examples of Canadian mines being bought out. Here are a few notable examples:
- Kinross Gold-Red Back Mining merger: In 2010, Canadian gold mining company Kinross Gold acquired Red Back Mining, a West African-focused gold miner, for approximately $7.1 billion. The deal was structured as a merger, with Red Back shareholders receiving 0.25 of a Kinross share for each Red Back share held.
- Goldcorp-Yamana Gold merger: In 2014, Canadian gold miner Goldcorp agreed to acquire Yamana Gold, another Canadian gold miner, in a deal valued at approximately $3.6 billion. Under the terms of the deal, Yamana shareholders received 0.1415 of a Goldcorp share for each Yamana share held.
- Detour Gold-Lake Shore Gold merger: In 2016, Canadian gold miner Detour Gold acquired Lake Shore Gold in a deal valued at approximately $1.5 billion. The transaction was structured as a merger, with Lake Shore shareholders receiving 0.4390 of a Detour share for each Lake Shore share held.
These are just a few examples, and the terms of each deal can vary greatly based on a number of factors such as the size and complexity of the transaction, the financial and operational performance of the companies involved, and the negotiation power of the parties involved, among others.
I then asked, "How often do mines sell for more than 10 billion dollars?"
It responded with, "The frequency of mining deals valued at more than $10 billion varies depending on various factors such as market conditions, commodity prices, and the availability of capital, among others. However, these types of large mining deals are relatively infrequent and tend to be complex, multi-party transactions that require extensive due diligence and regulatory approval.
Some of the factors that can drive the value of a mining deal higher include the size and quality of the deposit, the stage of development, and the geographic location, among others. As a result, the largest mining deals tend to be focused on large, established mining operations with a long mine life and a track record of stable production.
It's also worth noting that the mining industry is subject to significant fluctuations in commodity prices, which can have a significant impact on the value of mining assets and the willingness of companies to engage in large-scale transactions. This can result in periods of increased merger and acquisition activity, followed by periods of reduced activity as companies focus on consolidating their existing operations and reducing debt levels."
We know that the leaders of LME aren't interested in retaining stock of the company that buys them out, but I thought this might offer some context when considering the question above. Although, I'd love to imagine them selling for 20+ and becoming a millionaire, it seems a little unlikely given the answers above, etc.
Van