As Gold Prices Soar, Centamin Becomes Latest Miner to Leave London Amid AngloGold Takeover
Centamin will be the latest goldminer to exit the London stock market following its £1.9 billion ($2.37 billion) takeover by AngloGold Ashanti. This move comes as the price of gold hits record highs and London-listed miners struggle with valuation discounts. AngloGold Ashanti, headquartered in Johannesburg, has secured an attractive deal, offering a 37% premium to acquire Centamin's star asset, the Sukari goldmine in Egypt's Eastern Desert. Sukari has produced over 5.9 million ounces of gold since operations began in 2009, making it Egypt’s largest goldmine.
The takeover reflects the increasing consolidation within the global gold mining sector, which has been fueled by rising gold prices and the need for larger players to acquire assets rather than develop new projects due to high operational costs and challenges in exploration. This trend of mergers and acquisitions has intensified in recent years, with notable deals such as Newmont's $17 billion acquisition of Australian Newcrest in 2023 and South Africa’s Gold Fields’ move on Canada’s Osisko for $1.6 billion in 2024.
London’s gold mining sector has seen a sharp decline, exacerbated by the exodus of Russian miners after the invasion of Ukraine and a lack of new listings. Analysts predict more deals as larger miners, often based in North America, seek to acquire undervalued London-listed companies. Remaining companies like Endeavour Mining, Thor Explorations, and Resolute Mining could be prime acquisition targets.
The takeover also underscores the broader challenges facing gold miners, such as high costs, supply chain disruptions, and a shortage of skilled workers. These factors have driven companies to pursue acquisitions rather than develop new projects, as highlighted by experts who foresee continued consolidation in the sector.
Meanwhile, the bull run in gold prices shows no signs of slowing down, with predictions of further increases if interest rates are cut. Goldman Sachs has forecasted that gold prices could reach $2,700 per ounce by early next year, driven by central bank purchases and expected interest rate cuts in the U.S.
