Gold Fields is looking to iron out “dis-synergies” at the Gruyere gold mine in WA by acquiring Gold Road Resources.
Gruyere, managed by Gold Fields and owned through a 50:50 joint venture between the companies, saw lower production in the March 2025 quarter due to operational disruptions including two conveyor belts failing.
Gold Road said such occurrences may have prompted Gold Fields’ takeover bid, which involves the full acquisition of Gold Road for $3.05 per share, valuing its total equity at $3.3 billion. This represents a 28 per cent premium to Gold Road’s closing share price of $2.38 per share on March 21.
“After careful consideration and engagement with Gold Fields, the Gold Road board unanimously formed the view that the offer materially under values Gold Road and is highly opportunistic in nature,” Gold Road said.
“The offer appears to have been opportunistically tabled by Gold Fields in advance of the completion of exploration and studies into the potential underground expansion of the Gruyere mine.
“An 18-month drilling program to confirm that the Gruyere orebody extends at depth, with the results of that program being material to properly understanding the potential upside value of Gruyere.”
Gold Road said Gold Fields’ offer attributes “no value at all” to Gruyere’s potential underground expansion. The company said it had tabled a counterproposal to acquire Gold Fields’ interest in Gruyere which was rejected.
Gold Road said it was “extremely disappointing” for Gold Fields to publicly reveal the deal terms.
“Gold Road has engaged in active correspondence and dialogue with Gold Fields to consider whether Gold Fields would address the deficiencies of its offer,” Gold Road said.
“Despite Gold Road’s engagement in good faith and willingness to maintain confidentiality, Gold Fields has elected not to address Gold Road’s concerns privately but rather to publicly announce the terms of its offer despite our openness to engage.”
Gold Fields chief executive officer Mike Fraser said the acquisition of Gold Road aligns with its growth strategy.
“Consolidation of the remaining 50 per cent interest in Gruyere will eliminate dis-synergies that arise through the current joint venture ownership,” he said.
“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, similar to our recent acquisition of the Windfall project.”
At the bottom of the press release, Gold Fields acknowledged its announcement was made “without prior agreement or approval of Gold Road”.
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