anvil

Significant consolidation is a certainty within the DRC so articles like the following suggest there are signs of smoke coming from our JV partner.

Cash-flush Anvil may consider acquisitions

Source: Miningweekly.com

By: Liezel Hill
Published on 18th August 2008

Copper-miner Anvil Mining will certainly consider acquisition opportunities, in the Democratic Republic of Congo and elsewhere in Africa, but, for now, is mainly focused on completing its Kinsevere Stage II project, investor relations VP Robert la Vallière said on Monday.

La Vallière was commenting on speculation by RBC Capital Markets analyst Cailey Barker that the firm could use its strong cash position as a 'war chest' to embark on merger and acquisition (M&A) activity.

Anvill produces copper from three mines in the DRC, although mining operations have been halted at one of them – the Mutoshi mine – while it considers alternative mining methods and studies the feasibility of building an SX-EW facility at the operation, after poor results from the existing heavy-media separation (HMS) plant.

The company currently has $146-million in cash, and will receive another $296-million this quarter, after placing about 23,7-million shares with Dan Gertler-linked Catala Global.

The miner has indicated that it plans to use the cash on hand for its Kinsevere Stage II and Mutoshi SX-EW projects, but Barker is not convinced.

“We believe part of this may be used as a war-chest for potential M&A activity,” Barker said, in a note dated August 14.

“He's right that we do have a solid cash position, with no debt,” La Vallière agreed in a telephone interview from Montreal.

“We are looking...but at the moment the focus of our company is on completing the Kinsevere Stage II project on schedule.”

With regard to potential targets, the company would not limit itself to the DRC, although it would not likely look outside of the African continent, La Vallière indicated.