China’s Shandong Gold to acquire Ghana-focused Cardinal Resources for $221m

Sydney Opera House, Sydney, Australia. Photo by Frans on Unsplash

Shandong Gold Mining Co, one of China’s biggest gold producers, said on Thursday it would buy Ghana-focused miner Cardinal Resources Ltd for around A$321 million ($221 million) in cash.

The deal continues a recent M&A flurry by Chinese gold firms after spot prices for the precious metal XAU= hit their highest in more than 7-1/2 years at $1,764.55 an ounce last month, propelled by recession fears and Sino-U.S. tensions amid the novel coronavirus outbreak.

Shandong Gold, which in April agreed to splash out C$230 million ($170 million) on Canada’s TMAC Resources, said in a filing to the Shanghai Stock Exchange it had signed an agreement with Australia-listed Cardinal to pay A$0.60 per share and would acquire all the target’s equity for AS$309 million.

The Chinese miner will also subscribe for 26 million new shares to be issued by Cardinal at a price of A$0.46 per share for a total A$12 million.

Cardinal did not immediately respond to a request for comment outside of normal business hours.

Its website says it is focused on the Namdini gold deposit in Ghana, which has 5.1 million ounces of proved and probable ore reserves, and has other exploration projects in the West African country.

Cardinal’s shares closed down 3.1% at A$0.47 on Thursday.

Shandong Gold, whose shareholder Barrick Gold Corp this week said it had sold off most of its 17.9% stake in the company, noted the Cardinal deal was subject to regulatory approvals, including from the Australian Foreign Investment Review Board.

Reuters

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.