Saturday, February 4, 2023 | Gold Fields surges as acquisition target Yamana gets 'superior offer' | Gold Fields surges as acquisition target Yamana gets 'superior offer'




Shares of Gold Fields jumped by double digits on Friday afternoon, which came as acquisition target Yamana Gold said it had received a superior offer from Agnico Eagle Mines Limited and Pan American Silver.

The near $5 billion (R90 billion) cash-and-stock deal comes amid an offer from Gold Fields, that following a 40% decline in its US-listed shares in 2022, would now have a valuation of just above $4 billion, Reuters reported.

Yamana said in a statement that its board had determined the new offer to be superior, giving Gold Fields five business days to amend the terms of its offer, although it isn’t obligated to do so.

Gold Fields, which has offered 0.6 of its shares for each Yamana share, said in a statement it believed its offer was “demonstrably superior” and that it would continue to work towards completing the transaction. Yamana shareholders were set to vote on its offer on 21 November, and shareholders of Gold Fields the day after.

“The complementary nature of Yamana’s assets to the Gold Fields portfolio will create significant greater near-term and long-term value for the shareholders of Gold Fields and Yamana than the joint offer,” it said in a statement.

“It is clear that the Gold Fields offer remains strategically and financially superior to the joint offer with higher quality assets, lower operational and execution risk and higher sustained returns, given Gold Fields enjoys the free cash flow, balance sheet profile and technical capabilities to unlock the full potential of Yamana’s assets. The emergence of another offer indicates that other mining companies see the inherent value in Yamana’s assets,” it said.

Some investors have been vocal about their concern over all-share offer that was valued at $6.7 billion when announced, which reflected a 30% premium to Yamana’s market value of $5.2 billion at the time.

Gold Fields’ shares had crashed after the announcement, with analysts citing the premium being paid, while the miner repeatedly claimed that the deal is in the best interests of shareholders in the longer term, even if dilutive in the short term.

In late afternoon trade Gold Fields was up 11.41% to R154.30 on the JSE, having still lost about a fifth of its value since announcing the deal. Click here for details on the shares of Gold Fields and other info.

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