Digging deep, finding profits

The great mining predators are on the prowl again, says Judi Bevan. The Chinese are on a spending spree in Africa. And there’s plenty of room for canny investors to make money by following the deals closely

For those worried they have missed the move in mining shares – the FT mining index has nearly doubled since the market hit bottom in March – consider this. As of late November, the index was still around 40 per cent down from its peak in June 2008 and a renewed outbreak of bid speculation – along with Xstrata’s so far unsuccessful approach to Anglo American – indicates that those who are actually running mining houses believe there is plenty more value to be unleashed.

The surge in share prices has given predators such as Xstrata the paper power to go prowling once again. Before the stock market meltdown of last autumn, several deals had been in the air.