The directive “significantly compresses M&A optionality and potentially restricts financing options for Canadian miners,” Scotiabank analysts Orest Wowkodaw and Eric Winmill said in a Monday note. “As a result, we now anticipate most Canadian miners to trade at lower valuation multiples versus global peers.”
The new directive suggests that large Canadian-headquartered companies including Cameco Corp., Teck Resources Ltd., Ivanhoe Mines Ltd. and Lundin Mining Corp. “are now off-limits to potential foreign buyers,” the analysts wrote. Other companies named were First Quantum Minerals Ltd., Hudbay Minerals Inc., Capstone Copper Corp. and Ero Copper Corp.
The S&P/TSX Materials Index, which includes metals producers, fell 1.1% Monday, with most of the companies named by Scotiabank’s analysts leading the decline.
“This is clearly designed to prevent the same fate experienced by the last generation of large Canadian…
