Gold Fields increases takeover offer for Gold Road Resources to $3.7b

Australia Broadcast Center

05-05-2025

The head of a Perth-based gold miner that is the target of a $3.7-billion takeover bid expects there will be further consolidation in the sector as prices for the precious metal reach record highs.
The ASX-listed Gold Road Resources emerged from a trading halt on Monday to announce that its South African joint-venture partner, Gold Fields, had increased its previous bid of $3.3b by 43 per cent.
The companies jointly own the
Production at the Gruyere gold mine got underway in 2019.
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Supplied: Gold Road Resources
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Gold Road managing director Duncan Gibbs said the original offer was rejected as "opportunistic" because it did not take the potential for a future underground operation into account.
"It was a bit out of the blue because Gold Fields hadn't actually approached us prior to that — and it arrived by email, which we found a bit surprising," he said.
"That's all history now because there's been a lot of engagement to get to the outcome we've got now.
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It's a good deal for Gold Road and the feedback I've had to date has been very positive.
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In the absence of a superior proposal, Gold Road's board has recommended shareholders vote in favour of the takeover at a meeting likely to be held in September.
The takeover is also subject to approval by the Foreign Investment Review Board, which is likely to be a formality given Gold Fields already operates three other mines in WA.
More deals to be done
The new offer comes amid renewed interest in the mergers and acquisitions space as the Australian dollar gold price
Australia's biggest gold miner, Northern Star Resources, officially took ownership of the rich Hemi discovery in WA's Pilbara region on Monday after completing its
WA gold miner Ramelius Resources is also progressing a takeover of Spartan Resources, its neighbour in the state's Midwest, in a deal worth $2.4b.
Mr Gibbs said he expected more consolidation to follow.
The processing plant at the Gruyere gold mine has had ongoing operational issues since it was commissioned in 2019.
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Supplied: Gold Road Resources
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"Do I think there's probably going to be more of it? Yes," he said.
"Everybody is talking to everybody, which is situation normal.
"I think there are points in price cycles which drive a bit more consolidation, but these things appear to go in waves.
"The reality is companies are looking to grow all the time.
"That can be through bolt-on acquisitions or larger mergers, which we have seen."
Australia's next big gold mine
Meanwhile, as the dust settles on its De Grey takeover, Northern Star Resources is turning its attention towards building Australia's biggest new gold mine at Hemi.
Northern Star managing director Stuart Tonkin said the company would update the Hemi project timelines later this year once there was a clearer picture on the regulatory approvals.
Northern Star Resources managing director Stuart Tonkin has described the Hemi project as being "low-cost" and "long-life".
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ABC Goldfields: Jarrod Lucas
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A feasibility study released in September 2023 estimated Hemi would cost $1.3b to bring into construction, creating 900 construction jobs and 600 operational roles.
Previous owner De Grey Mining expected construction to take two years at the mine, which is 85km from Port Hedland.
"The [capex — capital expenditure estimates] will need to be reviewed and dusted off to make sure it's still relevant," Mr Tonkin said.
"De Grey had been articulating what the timeline was and we're not indifferent to what that is."
Northern Star Resources' Steve McClare and Kalgoorlie Consolidated Gold Mines' Nick Strong oversee construction of the Fimiston Mill.
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ABC Goldfields: Jarrod Lucas
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Mr Tonkin said construction crews at work on a
"We take a lot of learnings away from the Kalgoorlie expansion," he said.
"The neatness of teams moving from Fimiston into Hemi is very strong."
The previous feasibility studies for Hemi estimated an initial 12-year mine life and payback on the $1.3 billion investment in less than two years, based on an Australian dollar gold price of $2,700 an ounce.