Mining Journal > Finance > Stockpile: BHP’s hostile bid for Potash Corp steals the headlines

Finance

BHP Billiton tops the headlines this week, after the world’s largest miner announced ambitions to get even bigger and more diverse with a bid for Potash Corporation of Saskatchewan Inc.

As is often the case with takeover deals, the suitor’s share price has fallen since the bid was first announced, falling 7% in the week. On Friday its all-cash offer to PotashCorp’s shareholders was officially launched, after an earlier, more discreet, approach was revealed by the target. The US$130/share offer is open for acceptances until October 19.

The only mining company on the main board that experienced a bigger fall in its share price this week was Eurasian Natural Resources plc. The Kazakhstan-based mining company reported a 63% increase in half year earnings this week but warned that commodity markets may be volatile for the rest of 2010.

Ferrexpo plc was the top gainer this week without any official corporate news out on the company. While slightly softer in the week, the spot price of 62%-grade iron ore has gained by about 25% in the last month according to data from The Steel Index.

Randgold Resources plc was the second-best performer. The gold price continues to remain strong and is only a few percentage points away from its all-time high. Bloomberg pointed out that the precious metal has gained 12% so far this year and is currently heading for its 10th year of annual gains.

On the AIM, explorer Beowulf Mining plc gained almost 40% despite not making any announcements. Earlier this month, the Sweden-focused company did release promising drilling results at its Kallak iron-ore mine.

GGG Resources plc (formerly Central China Goldfields plc) was 19% higher after reporting (together with joint-venture partner Auzex Resources Ltd) a new 450%-higher JORC resource estimate at its Bullabulling project in Western Australia. The company added that the mineral resource estimate is expected to increase with further exploratory drilling.

Mozambique-focused Baobab Resources plc moved 14% ahead since announcing that a new drilling programme at the Tete iron/vanadium/titanium project had started. The company said it planned to update the resource inventory by the end of the year.

Shares in Australia developer Thor Mining plc improved by 12.5% (surging by 35% on August 16 alone) on news it had acquired an additional 9% of the Dundas gold project in Western Australia.

Elsewhere, Arian Silver plc, the only pure-silver-focused company on AIM, was up 19% after releasing news of a share issue, while Turkey and Saudi Arabian-focused gold explorer Kefi Minerals plc added 18%.

Scotgold Resources Ltd fell 28% after planning permission for a gold and silver mine at Cononish in Scotland was refused during the week. The company said it was likely to appeal the decision and was exploring its options.

After a spike in its value earlier this month, Condor Resources plc lost almost 20% of its gains. The company, which operates in South America, had previously made up ground on an announcement that it had commenced a trenching and drilling on the La India project in Nicaragua.

Other companies to record losses included Mercator Gold plc and Ormonde Mining plc, both falling about 12%.