I. Risk Status of Mining Overseas Mergers and Acquisitions
In 20 12, the global economy was in a downturn, and the number and amount of mining mergers and acquisitions fell sharply; There are 94 1 mining mergers and acquisitions in the world, with a total amount of 104 billion Australian dollars, which is 9% and 36% lower than that of 20 1 1 respectively. The financial crisis has caused the mining capital markets in Canada, Australia and other countries to face financing difficulties. The market values of primary exploration companies and unconventional energy enterprises have shrunk dramatically, and local governments in some mining developed countries have strengthened lobbying and investment attraction, which has made China's overseas mergers and acquisitions go against the trend. In 20 12 years, China's M&A transactions accounted for 2 1% of global mining M&A transactions. The international mining recession has become an important opportunity for China mining and non-mining enterprises to accelerate their overseas investment. However, opportunities and risks coexist, and the risks of mining overseas mergers and acquisitions follow one after another, which are mainly reflected in macro risks such as political risks and social environmental risks of the host country, as well as micro risks such as business background risks and project cost control risks of China enterprises.
1. Political risks in the host country
China's large-scale investment in the global resource industry has aroused all kinds of abnormal speculations and unnecessary worries from the outside world, and aroused political vigilance in some countries, thus adjusting foreign investment policies and increasing the government's review of investment from China. For example, in 20 12, the Mongolian government stopped the exploration and mining activities legally licensed by China South Gobi Resources Co., Ltd., which triggered the "South Gobi case"; Although the case of CNOOC's acquisition of Nixon has been passed in Canada, this case has prompted the Canadian government to adjust its policy for foreign state-owned enterprises to acquire Canadian resource companies, making it difficult to replicate similar mergers and acquisitions in the future.
2. Social and environmental risks in the host country
In terms of investment areas, Oceania, Asia and Africa are still the main target areas for China's overseas investment. The social environment in these areas is relatively poor, which makes China's overseas mining investment repeatedly impacted by social environmental risks. For example, in a gold mine controlled by Zijin Mining in China, a large-scale fight broke out between Russian workers and local residents, resulting in several injuries. Local residents held demonstrations to demand the deportation of China workers. In addition, in the process of overseas investment, environmental protection and community issues are intertwined with cultural traditions and national feelings, far beyond the legal scope, and it is very difficult to solve them. Because of the protection of indigenous culture and other issues, generally speaking, it is difficult for Chinese personnel to integrate into local customs for a while, and they are easily rejected and made difficult by local authorities in production and operation. At the same time, it also involves the local labor policy and the influence of trade unions.
3. Business background risk
According to the amount of investment, the main bodies of China's overseas investment are: cross-industry enterprises, mining enterprises and geological prospecting units. It can be seen that non-mining enterprises including manufacturing, trade, engineering and real estate are more enthusiastic about overseas investment. According to the filing data of China Mining Association, in 20 12 years, the cross-industry investment of non-mining enterprises in overseas mining field was 4.685 billion US dollars, accounting for 69% of the total investment in overseas mining in China. It is both a good thing and a high-risk thing for non-mining enterprises to invest and mine overseas. Due to the lack of professional technical background and industry experience, the investment quality of a few projects is not high, and individual projects can not even produce and operate normally.
4. Enterprise project cost control risk
For more than a decade, the global wave of mergers and acquisitions of mining enterprises has continued, and high-quality resources have been in the hands of international mining giants. At present, the quality of projects obtained by Chinese enterprises is usually poor, and some projects are forced to add project investment because of poor infrastructure conditions or abnormally high wages of local labor, which leads to inaccurate overseas investment budgets of some enterprises and difficult cost control.
Second, the risk development trend
Soft environment refers to the sum of factors and conditions that affect mining mergers and acquisitions, such as system, law, policy, culture and even thinking concept. The uncertainty of economic development brought about by the deep adjustment of the world economy, the new hidden worries of the international monetary and financial system, and the troubles of resource protectionism. All kinds of contradictions are intertwined and inevitably mapped to overseas mining mergers and acquisitions, which makes the soft environment risk present some new trends.
1. The rise of resource protectionism
Its main manifestations are the intensification of political risks in the host country and the increase of legal and policy restrictions involved in the investment and merger of enterprises in China. Many host countries gradually strengthen state control over resources, hoping to introduce foreign capital to ease their development embarrassment, but they are also worried that other countries will occupy their own resources and give their state-owned companies more development privileges; It not only saved the decline of domestic mining economy by implementing the international M&A policy, but also restricted the foreign capital's holding of domestic resource companies, thus greatly improving the entry threshold of M&A. In this way, the instability of the host country's resource policy will inevitably lead to the uncertainty of mining rights change, making resource protectionism a new problem in overseas mining mergers and acquisitions. If resource protectionism continues to develop abnormally, it will inevitably lead to more variables in overseas mining mergers and acquisitions.
2. Environmental protection and social permission are becoming more and more harsh.
Without adequate preparation, China enterprises may be unfamiliar with the environmental protection and social permission involved in overseas investment. At present, the environmental protection and social licensing conditions in some host countries and investment places are increasingly harsh, which may even affect the normal development of overseas mining mergers and acquisitions. For example, due to the failure to take into account the environmental protection costs, community obligations and the relocation costs of residents in different countries, individual China enterprises have failed to invest when purchasing mines overseas.
3. Lack of skilled workers abroad
Ernst & Young's report shows that in the next five years, Australia's resource industry needs to increase 6.5438+0.7 million skilled employees, otherwise it will lead to a decline in industrial output. 40% of Canadian mining workers will reach retirement age in 20 14 years, and these people have an average of 2 1 year of mining experience. Their retirement will make the technical talent gap reach 60,000 ~ 90,000 in 20 17 years, and many mining enterprises may have a passive situation of "talent shortage". In addition, the biased labor protection policies held by powerful trade unions in some host countries have increased the cost of overseas mining mergers and acquisitions, increased the difficulty of project promotion, and the talent problem has become a short board that restricts the project landing.
4. The project lacks the continuous support of the capital chain.
At present, it is difficult to mortgage overseas assets and mineral rights, and loans are mainly obtained through "domestic insurance and foreign loans" to invest in overseas mining projects, which increases the financing burden of domestic entities. Generally speaking, most domestic geological prospecting units tend to operate in the mode of holding shares and self-supporting in the process of overseas mining mergers and acquisitions, register or purchase exploration rights, use their own funds, enterprise funds, state funds or subsidies to carry out exploration, and integrate investors, operators and contractors, which makes the capital chain of Chinese enterprises tense, the support is not strong, the ability to cope with changes in the host country's resource policies is poor, and the resources and assets of overseas mining mergers and acquisitions cannot be effectively protected. In addition, a common problem for private enterprises to participate in overseas mining mergers and acquisitions is that it is difficult to obtain loans and financing support, showing the embarrassment of going it alone.
III. Countermeasures and Suggestions
In recent years, relevant state ministries and commissions have actively supported China enterprises in overseas mining mergers and acquisitions in special funds and consular protection, and achieved certain results. On this basis, according to the present situation of M&A risk in overseas mining industry and the changing trend of soft environment risk, it is suggested to further improve risk prevention from the following aspects.
1. Improve the financing mechanism of overseas mining M&A investment.
The first is to improve the investment risk prevention and control system. It is necessary to establish and improve the planning, coordination, service and management mechanism to promote overseas mining M&A investment, especially to improve the financing management system of overseas mining M&A activities, and formulate or revise relevant laws and regulations according to the present situation of overseas mining M&A risk and the changing trend of soft environment risk. The second is to establish a financing market for mineral exploration. We can carry out overseas M&A exploration and financing activities in China's existing capital market venture field, clarify the listing standards of exploration enterprises, and cultivate new mineral exploration subjects. Third, actively open domestic and foreign mining rights platforms. Taking Tianjin International Mining Finance Reform Demonstration Base as the carrier, the mining rights of overseas mergers and acquisitions are actively encouraged to be traded on this platform, so as to achieve the purpose of integrating domestic and foreign mining rights. Fourth, vigorously promote financing reform. As soon as possible, formulate relevant standards that are in line with the internationally accepted resource reserve standards, and promote the financing reform of mining enterprises in various ways, such as equity financing, fund financing, trust financing and bond financing.
2. Government consultation and dialogue to resist resource protectionism
The first is to sign a reciprocal agreement on overseas mining investment. Do a good job in intergovernmental consultation and dialogue with relevant resource-rich countries, establish strategic partnerships for resources, further strengthen support and assistance for infrastructure construction in resource-rich countries and investment places, and actively promote the establishment of a balanced and win-win international resource map. The second is to establish an early warning mechanism for overseas mining mergers and acquisitions. Establish and strengthen the power of resource consultants in embassies of countries related to overseas mining investment. Actively establish overseas contact points to timely understand and master the local information about the soft environment of mining mergers and acquisitions. The Ministry of Land and Resources formulates and revises the Guide to Mineral Resources Exploration and Investment in Important Countries in the World in a timely manner, so as to give early warning to the latest resource policies of resource-rich countries, especially the changes in soft environment.
3. Encourage private enterprises to participate in overseas mining mergers and acquisitions.
The first is to formulate regulations for the approval of overseas investment projects by private enterprises. Transform government functions, simplify the examination and approval procedures for foreign direct investment of private enterprises, and formulate detailed rules for the management of overseas mining mergers and acquisitions of private enterprises in combination with the characteristics of mining industry. The second is to provide policy information release and sharing mechanism. At the national level, the cooperation between relevant government departments should be further strengthened, and relevant policies and measures such as "going out" pre-investigation which is distributed to enterprises through Tianjin Mining Rights Exchange and enjoys state support should be adopted. Third, private enterprises acquired by overseas mining industries are inclined in financing. Domestic financial departments and financial institutions should support private enterprises to enter overseas mining M&A projects at the high end of the value chain, and China Export Credit Insurance Corporation should provide preferential treatment for private enterprises to engage in overseas mining M&A and other mining investment activities.
(writing: aftertaste)