EDITORIAL: Mining’s giddy moves
Is a mining CEO the latter-day Sisyphus of the business world: doomed to the eternal punishment of pushing his boulder up a hill, only for it to roll back down?
Is a mining CEO the latter-day Sisyphus of the business world: doomed to the eternal punishment of pushing his boulder up a hill, only for it to roll back down? It certainly seems like it. Miners, it appears, only ever buy a business when the going has peaked, and shareholders will be guaranteed a set of value-destructive impairments a few years later, when the cycle turns.
Impala Platinum’s multibillion-rand takeover of North American Palladium, just as palladium prices hit record levels, feels like one such roll of the boulder. The problem, as explained on page 52, is that mining companies invariably don’t have any money at the bottom of the resource cycle when metal prices are low, companies are in trouble and deals are cheap...
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