China Minmetals Corporation said that the recent drop in share valuations of global mining companies is throwing up a lot of opportunities for potential acquisitions.

Mr Zhang Yuanrong senior VP of the Beijing based company said that “The market is experiencing a downturn and we do see a lot of opportunities but we would evaluate each one of them very carefully.”

Global growth concern has driven 23% drop in the Bloomberg World Mining Index in the past six months. BlackRock Inc which manages USD 36 billion in natural resources said this week it expects the massive industry consolidation in mining to continue, driven by low valuations of companies.

Mr Andrew Michelmore CEO of the company’s Hong Kong traded unit Minmetals Resources Limited said that “The expectation in the market has come back to a level where you can have a conversation that’s sensible on valuation. Whereas before with the same value in mind the conversation was not worth having because of expectations of rising prices.”

According to data from the Bloomberg World Mining Index, mining companies are trading at 9.35 times their estimated earnings on concern over the global economy, about half their average in the past 5 years.

According to a report this week by Ernst & Young LLP, there was USD 132 billion of mining deals in the first 9 months of the year up from USD 79 billion for the same period last year.

(Sourced from Bloomberg.net)