Gold Road shares soar on $3.7b takeover bid
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More news: Gold Road shares rallied following news that it had agreed to an improved $3.7 billion takeover bid from South Africa’s Gold Fields.
Gold Road shares were up 9.6% to $3.26 in early trading and over the last 12 months have soared 106.33%.
Gold Road agrees to $3.7b takeover bid from South African partner
The news: Miner Gold Road Resources has agreed to an improved $3.7 billion takeover bid from South Africa’s Gold Fields.
The numbers: Under the proposed deal, Gold Road shareholders will receive a fixed cash consideration of $2.52 a share plus a variable cash consideration for the company’s holding in Northern Star Resources, which is currently valued at 88 cents a share. The total cash consideration of $3.40 a share represents a 43% premium to its closing share price on 21 March, and is a 12% improvement on Gold Fields’ initial offer, Gold Road said.
The context: Gold Road said its board unanimously recommends in favour of the Gold Fields offer and that shareholders with 7.5% interest have provided confirmation that they intend to vote in four of the deal.
“This scheme provides Gold Road shareholders with an opportunity to provide certain value for their Gold Road shares at a compelling premium,” managing director Duncan Gibbs said in a statement.
The news comes just weeks after Gold Road rejected a $3.3 billion takeover bid from Gold Fields in March, calling the proposal “highly opportunistic” and saying it attributed no value to the potential underground expansion of the Gruyere mine in Western Australia. The Australian miner and the Johannesburg-based Gold Fields hold an equal stake in the mine. The latest offer comes just days after Northern Star Resources completed its $5 billion acquisition of De Grey Mining, in which Gold Road held the largest stake.
The source: ASX
