Australian miner Oxiana is scouring for mergers and acquisitions and is looking to move beyond its traditional markets of Asia and Australia and into Africa and Latin America, Chief Executive Owen Hegarty said on Wednesday.
"We're always looking for the bolt-on style, the smaller guys. That's how we've been successful in the past," Hegarty told Reuters in an interview on the sidelines of the CESCO/CRU copper conference in Chile.
"They're the sort of things we're looking at, whether they be in copper, other base and precious metals, gold, lead, silver, zinc, nickel and even moving outside that square too."
Oxiana is in the middle of a $A6.1 billion takeover of fellow Australian miner Zinifex.
"That's a merger of equals ... It's a good-karma type of merger. It gives us greater strength, a bigger position, stronger cash flow to look at bigger acquisitions or developments that would not be available to each company in its own right," Hegarty said.
He expects Oxiana's mine output to rise slightly in 2008 from last year's levels. In 2007 the miner produced around 130,000 tonnes of zinc, close to 80,000 tonnes of copper and 200,000 ounces of gold.
He said the company is also eyeing an improvement in its full-year net profit, which fell 45 per cent in 2007 to $A305.8 million due to low zinc prices and Australian dollar weakness.
Improvements will follow higher copper prices and volumes and the fact that the firm's Prominent Hill gold and copper mine will enter production in the fourth quarter of 2008.
"The important thing about the next couple of years is Prominent Hill coming on line. Next year will be the first full year of production. We'll produce at today's prices cash flow just short of a billion (Australian) dollars," Hegarty said.
"That will be a tremendous boon to the whole bottom line and cash flow situation."
Hegarty says there are 2.0 million tonnes of copper in resources and nearly 4.0 million ounces of gold in the Prominent Hill deposit, which Oxiana bills as "the world's next best copper gold mine".
The company forecasts the mine will produce up to 120,000 tonnes of copper a year and up to 100,000 ounces of gold.
Oxiana mines gold and copper in Laos and Australia and also operates in Thailand, Cambodia, southern China, and Indonesia.
"We know that patch very well ... but we are looking at moving outside that particular patch, into Africa, South America. We'd love to be here, the home of copper," he added, referring to Chile.
OXR Price at posting:
0.0¢ Sentiment: LT Buy Disclosure: Held
