Tackling the growth imperative as a senior gold producer

Placer Dome is the world's fifth largest gold producer with seventeen mines operating in seven different countries. This paper provides an analysis of the gold mining industry as well as Placer Dome as a company in order to determine the most appropriate strategy for growth. An internal analysis is conducted, including a strategic fit analysis, a value chain analysis and a financial analysis. This paper identifies key issues facing the company regarding its future growth. First, grassroots exploration has had a low instance of success due to under spending during a period of weak gold prices. In addition, developing major projects will stretch the company's financial and personnel resources due to a poor share price performance and a business restructuring project. As well, the market continues to punish gold companies which diversify from pure gold. It is recommended that Placer Dome pursue a combination of organic growth, geographic diversification and increased M&A efforts.