Gold Fields is disappointed that the board of Gold Road Resources has 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.
As part of its rejection of the proposal, Gold Road has expressed a preference to enter an alternative transaction in respect of an acquisition of Gold Fields’ 50% interest in the Gruyere mine. Gold Road proposed this would be funded through a combination of (i) Gold Road’s existing cash; (ii) monetisation of Gold Road’s marketable securities; (iii) existing and / or new debt facilities; and (iv) issuing new equity.
“We believe our Proposal represents a compelling opportunity for Gold Road shareholders to realise an attractive and certain cash price for their investment. “We are disappointed that Gold Road’s Board of Directors has rejected our proposal. Gold Fields will continue to seek the engagement of the Gold Road Board to consider the merits of the proposed acquisition and to advance the proposal,” says Mike Fraser, CEO of Gold Fields.
“Consolidation of the remaining 50% interest in Gruyere will eliminate dis-synergies that arise through the current joint venture ownership. The proposed acquisition would be consistent with our strategy to improve the quality of our portfolio through investment in high-quality, long-life assets, like Gruyere, like our recent acquisition of the Windfall Project.
“The proposed acquisition would crystallise significant value for Gold Road shareholders in a volatile market. It would also consolidate ownership of an attractive cash producing asset that is expected to support greater capital returns to Gold Fields shareholders going forward. “Gold Fields will remain disciplined with regards to the proposed acquisition of Gold Road and prudent in its acquisition strategy to ensure continued maximisation of shareholder value. Gold Fields also remains committed to maintaining a strong balance sheet with sufficient access to liquidity and funding to finance the proposed acquisition.”
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Gold Road Resources rejects A$3.3 billion from Gold Fields
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