How has BMO Capital Markets’ metals and mining practice developed?

At BMO we are proud to have served the Global Metals & Mining sector for more than a century. We have one of the world’s largest metals-and-mining-focused investment & corporate banking, equity research, and sales & trading teams, and we host one of the world’s pre-eminent Metals, Mining, & Critical Minerals conferences. 

Over the last few years, the environment for precious and base metals has been relatively robust, although there has been some weakness in critical minerals such as lithium, nickel and graphite, and investor interest has been impacted accordingly. Nevertheless, the backdrop remains constructive, leading to high levels of capital markets activity. 

Since the start of 2023, we have advised on more metals and mining M&A transactions, both in terms of the number of transactions and transaction value, than any other investment bank globally. Additionally, we have raised more equity for metals and mining companies globally than any other bank, and our other business segments, including lending, DCM, leverage finance, and commodities, have also performed strongly.

Can you share some recent notable deals that BMO Capital Markets has been involved in?

We advised on Teck's US$9 billion sale of its steel-making coal business to Glencore, are advising Filo on its pending C$4.5 billion sale to BHP and Lundin Mining, and are advising Stelco on its pending C$3.8 billion sale to Cliffs. In London, we are advising Centamin on its pending US$2.5 billion sale to AngloGold Ashanti and also advised on the US$2.0 billion sale of Khoemacau. We also recently advised on the C$875 million sale of Reunion to G Mining. On the financing side of things, some recent wins include acting as joint bookrunner on First Quantum’s C$1.55 billion financing, Hudbay’s US$402 million financing, and Foran’s C$260 million financing, amongst others, and acting as the sole underwriter on Ivanhoe’s US$575 million financing. 

How would you assess the current mining finance climate, particularly in Canada? 

I truly believe there is no country in the world that has a deeper set of executive talent surrounded by a world class ecosystem of institutional and retail investors, analysts, investment bankers, lawyers, accountants, and regulators which allows for effective diligence and ultimately sophisticated presentation of mining companies to the investor community. 

Unfortunately, over the last few years we have not seen as much capital flow into institutional investor funds in Canada focused on metals and mining as we used to, so Canada’s relevance as a source of institutional investor dollars in this space has been negatively impacted. 

What challenges do junior companies face currently?

Some junior companies with first or second-quartile assets or well-known management can source equity capital, which is essential for executing their business plans. Unfortunately, others with less experienced management or lower-quality assets have struggled to raise meaningful equity capital. 

Do you expect increased M&A activity to continue?

I believe we are in a consolidation phase. We have seen M&A activity across the sector, with both large-scale consolidation and consolidation across the junior space. As funding for the junior space has been challenged, fewer new companies are being created, which has led to a smaller opportunity set. Given the strong commodity price backdrop and healthy valuations, we expect continued consolidation as larger companies seek to secure assets before the opportunity set dwindles even further.

How does BMO Capital Markets intend to maintain its position and what are your objectives for 2025?

We consistently think about how to diversify and grow our business in terms of the products we offer, the commodities we focus on and the geographies we operate in. For example, a few years ago we formally rebranded our annual conference to call it the BMO Global Metals, Mining, & Critical Minerals Conference, specifically including a critical minerals stream. 

Our objective for the upcoming year is the same as it has been for the last 20 years – we aim to continue to be the #1 metals & mining investment bank in the world – and we know ultimately the only way we can achieve that objective is by ensuring we are wholly and completely focused on delivering for our clients.