Australian miner Gold Road Resources has confirmed the rejection of a takeover offer from South Africa-based Gold Fields, which sought to acquire all shares of Gold Road for A$2.27 ($1.42) per share plus additional cash related to Gold Road’s interest in De Grey Mining.
The board unanimously agreed that the offer undervalued the company and was “highly opportunistic”.
After receiving the proposal post-market on 7 March 2025, Gold Road’s board engaged with Gold Fields but found the offer to be unsatisfactory.
The timing of the offer coincided with Gold Road’s lower production in the March 2025 quarter due to maintenance issues.
Gold Fields, which manages the Gruyere Joint Venture (JV) with Gold Road, made the proposal ahead of exploration results for the potential underground expansion of the Gruyere mine, in which Gold Road currently holds a non-operating JV stake.
An 18-month drilling programme is under way to assess the orebody’s depth, which is crucial for understanding Gruyere’s full potential.
The proposed acquisition would have strengthened Gold Fields’ ownership of Gruyere, a low-cost, long-life gold mine in Western Australia, according to the company.
As the mine’s operator, Gold Fields was uniquely positioned to present the proposal, offering Gold Road shareholders certainty of value, the company added.
Despite efforts to address the offer’s shortcomings in private, Gold Fields chose to make a public announcement, which Gold Road termed “disappointing” given their JV partnership established in 2017.
Further, Gold Road presented a counterproposal to acquire Gold Fields’ 50% stake in the Gruyere JV, which Gold Fields declined.
Gold Fields CEO Mike Fraser said: “We believe our proposal represents a compelling opportunity for Gold Road shareholders to realise an attractive and certain cash price for their investment.
“We are disappointed that Gold Road’s board of directors has rejected our proposal. Gold Fields will continue to seek the engagement of the Gold Road Board to consider the merits of the proposed acquisition and to advance the proposal.
“Consolidation of the remaining 50% interest in Gruyere will eliminate dis-synergies that arise through the current joint venture ownership. 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.”
Gold Road highlighted that Gold Fields is subject to standstill restrictions, preventing it from acquiring more than a 10% interest in Gold Road’s shares without prior notification.
To date, Gold Road has not been informed of any intent by Gold Fields to purchase additional securities.
Gold Road has engaged Gresham Partners as its financial adviser and Corrs Chambers Westgarth as its legal adviser.
In October 2024, Gold Fields completed the acquisition of Osisko Mining for $1.39bn (R25.37bn).
