China’s Zijin to Buy Canada’s Continental Gold for $1 Billion
China’s Zijin to Buy Canada’s Continental Gold for $1 Billion
(Bloomberg) -- Zijin Mining Group Co. agreed to buy Continental Gold Inc. in a deal worth C$1.37 billion ($1 billion), marking the second takeover in as many weeks of a Canadian gold miner.
Zijin will pay C$5.50 a share in cash for Continental and said major shareholder Newmont Goldcorp Corp. was supportive, according to a statement on Monday. The offer reflects a 29% premium to the share price from the past 20 days.
The company, China’s biggest listed producer of mined gold, has been making deals across the world in recent years as it looks to bolster its exposure to gold and copper.
The acquisition would give Zijin control of the Buritica gold project in Colombia, which is currently being developed. Output at Zijin Mountain, China’s top gold mine which the producer is named for, is dropping because of depleting resources.
The deal comes just a week after Canada’s Kirkland Lake Gold Ltd. agreed to buy Detour Gold Corp. for $3.7 billion, furthering an M&A spree that’s swept the gold mining industry.
There’s been constant speculation about gold mining acquisitions after huge deals rocked the industry in the last year: Newmont Mining Corp.’s acquisition of Goldcorp Inc. and Barrick Gold Corp.’s takeover of Randgold Resources Ltd. The two combinations created companies that dwarf the rest of the industry and mean that smaller miners feel the need to consolidate if they’re going to stay relevant to shareholders.
To contact the reporter on this story: Thomas Biesheuvel in London at tbiesheuvel@bloomberg.net
To contact the editors responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net, Liezel Hill
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