LONDON (Reuters) - Miner African Barrick Gold ABGL.L will remain “active” in considering acquisitions in West and Northeast Africa, despite a decision to treble its 2011 dividend and commit to a payout rate, as volatile markets have made valuations more attractive.
Chief Executive Greg Hawkins said the miner had looked at around 20 projects in the last 18 months, but was unable to “close the valuation gap” through the whole of 2010 and into 2011, when commodity prices were at their post-crisis peak.
“We remain pretty active in looking around in the M&A space. Prices...have come off pretty dramatically in the last couple of quarters, so valuations are getting a little more interesting and it is still part of the company’s strategy to broaden its wings across Africa,” he said.
Gold miners’ valuations are currently at their lowest in a decade, though cash flows are still close to historic highs thanks to robust gold prices, making gold a likely hotspot for mining mergers and acquisitions this year.
Reporting by Clara Ferreira-Marques; Editing by Sarah Young