“The reason why we may have seen a pickup in activity this year is because gold prices are around $1,200” an ounce, said Greg Fournier, Hong Kong-based head of Asia Pacific region metals and mining investment banking at Merrill Lynch. “If you have a view that the gold price is strong and is going to go higher then acquiring more reserves or producing properties today makes sense.”Also a factor is gold majors wanting to increase their resource base in a time when new gold deposits (particularly big ones) are becoming harder to find.
It's only a matter of time before takeover interest will move to smaller deposits. Because of the general fascination with huge-potential properties, the development companies with smaller properties have been overlooked - even ones with good grades. Although less convenient and less easy to manage, someone who's adept at a portfolio approach could put together an agglomeration of smaller properties and wind up with a mid-tier or even a major by collecting those leftovers. Given their low profile, they're likely to be cheaper than a major elephant.