South African miner Gold Fields (GFI) has agreed to buy Canadian precious metals miner
Yamana Gold (YRI) in an all-stock deal worth $6.7 billion U.S.
Gold Fields is offering 0.6 of one of its shares for each Yamana Gold share. The deal
represents a 34% premium to Yamana’s closing share price last Friday (May 27).
Gold Fields said its shareholders will own about 61% of the combined company once the deal is
completed, while Yamana Gold shareholders will own 39%.
The acquisition of Yamana Gold will make Gold Fields the world’s fourth largest gold producer.
Yamana currently has mines in Canada, Argentina, Chile, and Brazil.
Gold Fields said the acquisition fits with its strategy of expanding in “mining friendly” jurisdictions
across the Americas.
Gold Fields, which was founded in 1887, has shifted its focus in recent years to more lucrative
mines in Ghana, Australia, and Latin America. It has one mine left in South Africa, where
producers struggle with power outages, soaring costs and the challenges of reaching the
world’s deepest gold deposits.
Yamana’s board is supporting the deal, which requires approval from both sets of shareholders
and is expected to close in the second half of this year. Gold Fields said it will remain
headquartered in Johannesburg after the deal to acquire Yamana is finalized.
Gold Fields’ stock fell as much as 15% in Johannesburg trading on news of the acquisition,
erasing its gains for the year. Shares of Yamana Gold have risen 30% so far this year to $6.75
as commodity prices have increased around the world.
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