Keep an eye on Russians, says Gilbertson

FORMER BHP Billiton chief executive Brian Gilbertson, a bidder for Perth miner Consolidated Minerals, said the mining industry would continue to consolidate as Russian companies emerged as serious competitors to industry leaders like BHP Billiton and Rio Tinto. "I would be very surprised if you didn't see very powerful Russian companies emerging into the international markets in the resource area to rival the companies we are familiar with," he told the ABC's Inside Business. Before forming private equity consortium Pallinghurst Resources to have a tilt at ConsMin, Mr Gilbertson headed Russian aluminium producer Sual before its merger with Rusal and Glencore's aluminium assets earlier this year. The merged company, UC Rusal, leapfrogged Alcoa as the world's largest aluminium producer but its tenure at the top looks shortlived after Rio Tinto's $US38 billion ($43 billion) bid for Canada's Alcan. Still, Mr Gilbertson said the future of aluminium smelting was in Russia. "They have the energy resources," he said. "There are very few other parts of the world where there is cheap or stranded energy left." UC Rusal has reportedly hired advisers ahead of a public offering in London. It is understood the Russian company is keeping a close eye on aluminium industry developments and believes that having a market value would help it with potential acquisitions. Another Russian miner, Norilsk Nickel, recently beat Xstrata to acquire Canadian nickel miner LionOre for $C6.8 billion ($7.4 billion). Mr Gilbertson aims to gain control of a majority of ConsMin shares to create a "serious global footprint" for the miner, as he did with Billiton before its merger with BHP in 2001. "We made acquisitions, we invested in new projects," he said. "I think with [ConsMin] we can do the same," he said. Pallinghurst's latest offer for ConsMin is $3.30 cash a share. Territory Resources, led by former ConsMin boss Michael Kiernan, has made a rival bid of $2 cash and 1.5 Territory shares, valuing ConsMin at $3.50 at least. Industry sources said Territory was "seriously considering" a sweetened cash component. Territory is also understood to be reviewing the 17 conditions of its bid after some criticism by investors that it was too conditional.