Deal-making expected in DRC as mining companies undergo “survival of the fittest”

Barrick-AngloGold Kibali mine, DRC

THE prospect of deal-making in places such as the Democratic Republic of Congo (DRC) following the COVID-19 pandemic would likely increase, said Reuters citing mining firms operating in the central African country.

A rule of “survival of the fittest” would come to dominate in the DRC in the wake of the pandemic, and trigger an increase in deal-making, the president of the DRC Chamber of Mines said on Wednesday.

“I see an increase in M&A activities post-COVID-19 where the big players are shopping around for opportunities,” Reuters cited Louis Watum to have said during an online panel discussion. Watum is also MD of DRC operations at Ivanhoe Mines.

“Mining companies’ equities have been re-set practically across the globe and that does offer one a slightly lower barrier to entry … so absolutely our radars are out and (we) are scratching around wherever we think there may be some potential,” added Boris Kamstra, director of Pangea Exploration and executive director at Alphamin Resources.

Alphamin manages the Bisie tin mine in DRC’s North Kivu region.

Kamstra added, however, that COVID-19 would create a short-term crisis in securing mining supplies. “The world is currently running on inventory that it built up in the past. At some point that inventory is going to run a bit thin,” he said.

Amedeo Anniciello, CEO at Standard Bank DRC, said the bank could provide capital for deals partly thanks to its partnership with Industrial and Commercial Bank of China (ICBC). “Through them, we have a huge corridor of funding into this market,” he said. The DRC has $24Tr of value in mineral resources, Anniciello added.

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