Striking Gold: University of Michigan to invest in Gold & Copper

The University of Michigan will announce plans to invest up to $30million in a fund to buy North American gold and copper mines from struggling businesses in a meeting with this week.

With mining companies struggling to cope in a fluctuating asset market and riddled with debt, the move, which will be boosted by a $30million endowment from June 30, would come as a breath of fresh air to the industry.

“These opportunities arise from the financial distress of mining companies who took significant amounts of debt for M&A activity prior to the collapse in commodity prices since 2011,” said Kevin Hegarty, chief financial officer at the University of Michigan.

“Now looking to strengthen their balance sheets, these financially distressed companies are selling assets to raise cash and reduce debt levels.” He added.

The investment is a joint venture with Waterton Mining Parallel Fund, managed by Waterton Global Resources. The proposal for investment will be discussed in a meeting with the Board of Regents on May 19.

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Read the May 2016 issue of Mining Global magazine