Gold Fields has confirmed it is in active discussions with Australian miner Gold Road Resources, regarding a proposal to acquire 100% of Gold Road by way of an Australian scheme of arrangement.
Gold Fields issued the confirmation on Friday in response to recent media speculation and the trading halt announced on Friday by Gold Road in relation to a potential change of control transaction.
Gold Road said in a market announcement to the Australian Stock Exchange on Friday that its securities would be placed in trading halt at its request, pending it releasing an announcement.
“Unless ASX decides otherwise, the securities will remain in trading halt until the earlier of the commencement of normal trading on Tuesday May 6 2025 or when the announcement is released to the market,” the statement read.
On March 24, Gold Fields provided a non-binding, indicative and conditional proposal to Gold Road’s board to acquire 100% of the issued and outstanding share capital of the Perth-based miner.
Gold Fields offered a cash consideration of A$3.05 per share — which comprised a fixed portion of A$2.27 per share plus a variable portion equal to the value of each shareholders’ proportion of Gold Road’s shareholding in De Grey Mining.
The proposed acquisition would consolidate Gold Fields’ ownership of Gruyere, a low-cost, long-life producing gold mine in Western Australia in which Gold Road holds a non-operating joint-venture interest. The Gruyere mine is operated by Gold Fields.
Coveted for its low-cost production and long operational lifespan, Gruyere boasts a substantial mineral resource of more than 6-million ounces of gold, making it one of Australia’s largest undeveloped gold deposits. Its ore reserve is estimated at 3.7-million ounces with a mine life of more than 10 years. It produces about 35,000oz of gold per year.
The initial proposal was rejected by the Gold Road board and despite subsequent discussions, Gold Fields said it had been disappointed that the Gold Road board had not constructively engaged on key elements of the proposal, which would have allowed both parties “to confidentially progress towards an outcome that would deliver compelling and certain value to Gold Road shareholders”.
Gold Fields CEO Mike Fraser said at the time that the group had been disappointed and would continue to “seek the engagement of the Gold Road board to consider the merits of the proposed acquisition and to advance the proposal”.
As part of its rejection, Gold Road at the time expressed a preference to enter into an alternative transaction in respect of an acquisition of Gold Fields’ 50% interest in the Gruyere mine.
Gold Fields subsequently formally responded to Gold Road that it would not be progressing the alternative transaction.
Gold Fields said on Friday that given the nature of the proposed transaction, there could be no certainty that engagement would result in a transaction being successfully concluded and, accordingly, shareholders were advised to continue exercising caution when dealing in their securities until any further announcement was published.
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