Gold Fields to buy rival Yamana Gold in $6.7bn deal
South African mining giant Gold Fields is set to acquire rival Yamana Gold in a $6.7bn deal, which will make the company the world’s fourth largest gold mining group.
The agreement will create an industrials company with annual gold production of around 3.3m ounces.
The offer reflects a 33.8 per cent premium to Yamana’s average share price over the past 10 days.
Yamana shareholders will receive 0.6 Gold Fields shares for each share they hold, giving them about 39 per cent of the combined company – which will have a $15.6bn market capitalisation.
Gold Fields produces about 2m ounces of gold annually from nine mines in Australia, Ghana, Peru and South Africa.
It is also developing its flagship growth project – Salares Norte – in Chile.
Meanwhile, Yamana produces around half of that volume from its mines including Malartic in Quebec and El Peñón in Chile.
The takeover comes as big gold companies try to rebuild the fragmented industry, after being shunned by investors who have grown frustrated with the sector’s underwhelming performance
It follows last year’s “merger of equals” between Canada’s Kirkland Lake Gold and Agnico Eagle Mines that was completed in February.