Canada is a world leader when it comes to global mining acquisitions according to a study by Ernst & Young.
In the first half of 2011, 196 deals were recorded. Canada was the leading target destination with 129 deals occurring in the country between January and June.
Australia was second with 83 deals, and the second target destination with 72 deals inside the country.
Tom Whelan, leader of Ernst & Young's national mining and metals practice, says 2011 has resulted in “fewer, but larger” deals in the sector. “Despite the drop from 573 deals in the first half of 2011 to 511 deals in the first part of this year, the total deal value of mining transactions from January to June more than doubled to US $96.6 billion from US $47.9 billion.”
Average mining company debt is at all-time low while cash flow and profitability are at an all-time high. The demand for natural resources from emerging markets has led to an increase in deal activity.
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