Reuters Summit-Bankers see Equinox as ideal test for China Inc

(For other news from the Reuters Global Mergers and
Acquisitions Summit, click:
http://www.reuters.com/summit/MergersandAcquisitions11?pid=500)

TORONTO, April 5 (Reuters) – China’s Minmetals Resources
(1208.HK: Quote, Profile, Research) C$6.3 billion bid for Equinox Mineral (EQN.TO: Quote, Profile, Research) is the
perfect test case for state-controlled Chinese entities looking
to acquire overseas mining assets, Canadian bankers told the
Reuters Global Mergers and Acquisitions Summit on Tuesday.

Equinox, target of an unsolicited offer from Chinese metals
trader Minmetals, is a Canadian company with listings in both
Canada and Australia. While the majority of its board is based
in Canada, Equinox’s chief executive is based in Australia and
its assets are spread across Africa and the Middle East.

“I don’t think they could have picked a better target, or
timing to try a hostile bid and see what the reaction is,” said
John Tuer, managing director for mergers and acquisitions at
Scotia Capital, while speaking at the Toronto-leg of the
Reuters Summit.

Tuer noted the very fact that Equinox itself is entangled
in a hostile battle to acquire rival Lundin Mining (LUN.TO: Quote, Profile, Research)
also bodes well for Minmetals.

“As a test case for them, it’s about as good a fact-set as
you could have,” he said.

State-controlled Chinese entities have for the most part
focused on joint-ventures, resource off-take agreements and
minority stakes in foreign mining companies, as they attempt to
sate China’s growing appetite for metals and other
commodities.

“Given the fact that the great majority of the assets and
operations are abroad. It is less likely to be a controversial
issue than lots of other potential targets,” said Andre Hidi,
who heads the global mergers and acquisitions group at BMO
Capital Markets, the investment banking arm of the Bank of
Montreal(BMO.TO: Quote, Profile, Research).

(For top stories from the Reuters Global Mergers and
Acquisitions Summit, see [ID:nN01283917])
(Reporting by Euan Rocha; editing by Gunna Dickson)

Reuters Summit-Bankers see Equinox as ideal test for China Inc