Soaring commodities prices have left mining firms flush with cash and keen to expand. One Way would be to search for more metal in the ground, instead of on the stockmarket. But organic growth is expensive at the moment; as firms rush to increase their output to take advantage of high prices, every conceivable input, from engineers to mining trucks' huge tyres, is in desperately short supply. Developing new mines is also slow. Mining executives worry that projects that get the go ahead when prices are high will not look so attractive when the next slump comes.
That could be true of the proposed merger too, of course. Phelps Dodge offered a premium of 23% over the price of Inco's shares and 12% over Falconbridge's. Those shares, in turn, have been rising for several years along with the firms' wares--nickel, for the most part, at Inco, and nickel and copper at Falconbridge.
The bosses of the firms insist that the mark-up is justified, for several reasons. For one thing, they reckon they can squeeze savings of $ 900m a year out of the combined entity by 2009, by sharing equipment and personnel among adjacent mines, for example, and pooling their marketing staff. More importantly, they argue that the size and diversity of the new company will make it less vulnerable to mining's painful cycles, and so more attractive to investors.
The biggest and most diversified mining companies, such as BHP Billiton and Rio Tinto, do boast higher share valuations. They produce everything from aluminium to zircon, and so are less susceptible to flutuations in the price of any particular metal. By the same logic, the more mines a firm is running or developing, and the more countries it operates in, the less risk each individual project poses to profits.
The merged trio will certainly have a broader geographical spread, with mines in five continents. But its main projects, in stable places like the United States, Canada and Chile, never seemed that risky in the first place. Furthermore, despite having sidelines in cobalt and molybdenum, the new firm's fortunes will depend chiefly on the price of copper and nickel--two of most volatile metals of late.
Some analysts mutter that Phelps Dodge embarked on the merger chiefly to save itself from being taken over. Investors seem to share their doubts: Phelps Dodge's shares fell by 8% after it announced the deal, despite a simultaneous pledge to spend $ 5 billion on a share buy-back scheme once the merger is concluded.
On the other hand, the price of nickel and copper jumped on the news. Traders seem to have assumed that the companies would have contemplated such an expensive deal only if they thought that metals would remain in short supply for some time. The more money that mining firms spend buying one another, rather than exploring for and developing new mines, the likelier that is.
It can be inferred that some mining firms are keen to merge because
A.they want to monopolize the mining market.
B.they have greatly profited from skyrocketing prices of metals.
C.they are afraid of losing money on the stock market.
D.they want to defeat all the other competitors of mining industry.
第5题
A.作业时随身携带证件,并自觉接受用人单位的安全管理
B.积极参加特种设备安全教育和安全技术培训
C.严格执行特种设备操作规程和有关安全规章制度
D.制订特种设备操作规程和有关安全管理制度
第7题
A.作业时随身携带证件,并自觉接受用人单位的安全管理和质量技术监督部门的监督检查
B.积极参加特种设备安全教育和安全技术培训
C.严格执行特种设备操作规程和有关安全规章制度
D.拒绝违章指挥;
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