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Shandong Gold seeks Brazilian miner
Source: Agencies |
November 17, 2011, Thursday
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Print Edition
Print Edition
CHINA'S Shandong Gold Group, the parent of Shanghai-listed Shandong Gold Mining, has made a US$1 billion offer to acquire Brazil's Jaguar Mining, two sources close to the deal said yesterday.
Shandong Gold is offering US$9.30 per share in cash, a 73 percent premium to Jaguar's Tuesday close in New York.
If successful, the deal would be one of the biggest overseas acquisitions by a Chinese gold miner.
"Shandong Gold made the current offer about two weeks ago, and Shandong Gold has prepared cash to get the deal done," said one of the sources, who declined to be named because he was not authorized to speak to the media.
Chinese resources companies have been hunting overseas for the minerals needed to power the country's fast-growing economy.
"This is a positive development for the overall sector," said Yan Chen, metals and mining analyst at Standard Chartered Bank.
"So far, there are not a lot of Chinese companies that have bought gold resources overseas."
Shandong Gold, a state-owned firm, is one of China's top three gold miners. Its listed arm produced 19.41 tons of mined gold in 2010. The group has said it owns about 800 tons of gold resources.
Jaguar Mining is one of Brazil's fastest-growing gold miners, with operations in a prolific greenstone belt in the state of Minas Gerais. Jaguar's main development project is Gurupi, which holds reserves of 2.3 million ounces.
Gold hit an all-time high in September, reaching US$1,920.30 an ounce.
Shandong Gold is offering US$9.30 per share in cash, a 73 percent premium to Jaguar's Tuesday close in New York.
If successful, the deal would be one of the biggest overseas acquisitions by a Chinese gold miner.
"Shandong Gold made the current offer about two weeks ago, and Shandong Gold has prepared cash to get the deal done," said one of the sources, who declined to be named because he was not authorized to speak to the media.
Chinese resources companies have been hunting overseas for the minerals needed to power the country's fast-growing economy.
"This is a positive development for the overall sector," said Yan Chen, metals and mining analyst at Standard Chartered Bank.
"So far, there are not a lot of Chinese companies that have bought gold resources overseas."
Shandong Gold, a state-owned firm, is one of China's top three gold miners. Its listed arm produced 19.41 tons of mined gold in 2010. The group has said it owns about 800 tons of gold resources.
Jaguar Mining is one of Brazil's fastest-growing gold miners, with operations in a prolific greenstone belt in the state of Minas Gerais. Jaguar's main development project is Gurupi, which holds reserves of 2.3 million ounces.
Gold hit an all-time high in September, reaching US$1,920.30 an ounce.
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