Nash Equilibrium8 Dec 2025 12:24
I've been having a look at this along with a revised Wilkie approach over the last few days and the Nash seems to fit better because there are too many genuine unknowns to make the Wilkie meaningful. As you know, my opinion is that the Chinese will not own Cascabel although they could well end up with a consolation asset such as Porvenir. BUT:
In game theory, a Nash equilibrium is the point where no player can improve their outcome by changing their strategy, assuming all others stay the same. Each player settles into the best response to everyone else’s move. In takeover battles, this means a bidder wins when others no longer have any incentive to counter.
For JCC to reach this point, it must move beyond small, incremental bids. A low or modest offer invites other bidders like BHP or Newmont to act. It keeps shareholders waiting. It does not lock in the result.
To truly win, JCC must reset the game. A bid in the 65 to 70 pence range, all in cash, could be enough to change expectations. If paired with clear political and strategic alignment in Ecuador, it makes the deal appear more certain. Offering a stake or royalty to BHP or Newmont removes them as threats. Bringing in a neutral financial partner like a UAE or Eurasian investor softens the optics.
Once this is done, shareholders are offered a credible and immediate reward. Rivals see limited upside in acting. That could form the Nash equilibrium. No one moves. The game ends. This may be the only way for JCC to win SolGold cleanly. Anything less invites escalation.
Even though I would prefer the Chinese not to win, it has to be in our interests to see them and the West both bidding for this asset. I have been so unimpressed with BHP generally over the last few years (as the City appear to have been too). Can they get on the front foot here at last?
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