Shandong Gold is top bidder for US$2bil Glencore mine

  • Business
  • Wednesday, 28 Sep 2016

LONDON: China’s Shandong Gold Mining Co has emerged as the lead bidder for Glencore Plc’s gold mine in Kazakhstan, which may fetch about US$2bil in a sale, according to people familiar with the matter.

Shandong Gold, one of China’s largest gold producers, outbid other parties including Silk Road Fund, which had teamed up with state-owned China National Gold Group Corp, the people said, asking not to be identified as the information is private.

Glencore is still weighing all options for the asset, including selling future production from the mine for a fixed amount, and may decide to retain it, the people said.

In August, Glencore said it was exploring options for the Kazakh operations including a sale or a streaming deal for the Vasilkovskoye mine.

A spokesman for Glencore declined to comment. Shandong Gold didn’t immediately return calls and an e-mail seeking comment.

A representative for Silk Road didn’t have an immediate comment when reached by phone.

A representative for China National Gold couldn’t immediately be reached.

Chinese mining deals have almost tripled this year to US$27bil, compared with the same period in 2015, as commodity prices began to recover, data compiled by Bloomberg show.

China Molybdenum Co agreed in May to buy control of Freeport-McMoRan Inc’s copper mine in the Democratic Republic of Congo for US$2.65bil, following a US$1.5bil deal in April for Anglo American Plc’s niobium and phosphate business. China National Gold agreed to purchase Eldorado Gold Corp’s stake in the Jinfeng gold mine for US$300mil in April.

Glencore has been been selling assets and trimming costs as part of an effort to cut debt to US$16.5bil by the end of the year. Net debt was US$23.6bil on June 30. – Bloomberg

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