A new deal by two gold mining partners in Western Australia will see $3.7 billion change hands by the end of the year.
Gold Fields has announced plans to acquire Gold Road Resources, its 50:50 joint venture partner in the Gruyere gold mine.
If successful, the acquisition would give Gold Fields full control over the Gruyere mine, where it currently serves as operator. The operation is expected to produce between 325,000 and 355,000 ounces of gold in 2025.
Gold Road’s board has unanimously recommended shareholders vote in favour of the scheme. Gold Fields has stated its offer is “best and final”, with no intention of increasing it unless a superior bid emerges.
“The board has been focused at all times on ensuring that we deliver value and act in the best interests of our shareholders,” Gold Road chair Tim Netscher said.
“This cash proposal accelerates realisation of Gruyere’s value and provides certainty for Gold Road shareholders today at an attractive premium to trading levels prior to receipt of the initial Gold Fields proposal.”
Gold Fields initially put forth a $3.3 billion bid for Gold Road in March, which the company swiftly rejected.
The new proposed acquisition includes Gold Road’s Yamarna mine readiness project, located 60 kilometres southwest of the Gruyere plant. The Gilmour gold project within Yamarna is expected to be ‘shovel ready’ by late 2026, with a pre-feasibility study projecting a five-year mine life at an average of 50,300 ounces per annum and pre-tax free cash flow of $377 million.
Gold Road managing director and chief executive officer Duncan Gibbs noted the attractiveness of the deal for shareholders.
“The scheme provides Gold Road shareholders with an opportunity to realise certain value for their Gold Road shares at a compelling premium,” he said.
“This offer price represents a material premium to the undisturbed share price prior to the initial Gold Fields’ proposal and a material premium to longer term trading levels.
The deal remains subject to a range of conditions, including shareholder approval, with a vote expected to be held in September. Should it pass and all other conditions be met or waived, the acquisition is scheduled to be completed in October.
