South African mining firm Gold Fields has agreed to acquire Canada-based gold producer Yamana Gold in an all-stock deal, which values the latter at $6.7bn.
The transaction is expected to make Gold Fields the world’s fourth-largest gold producer with a diversified portfolio of long-life assets with long-term growth prospects.
Yamana shareholders will secure 0.6 Gold Fields shares for each share held.
Post deal completion, Gold Fields’ shareholders will hold a 61% interest in the merged entity while Yamana Gold shareholders will own the remaining 39% stake.
With headquarters in Johannesburg, South Africa, the combined business will have 14 mines in South Africa, Ghana, Canada, Australia, and South America.
Gold Fields CEO Chris Griffith said: “Today’s announcement is the result of a robust and extensive process carried out by the Gold Fields’ board and management team to identify the optimum solution to support our revised strategy.
“Yamana’s high-quality asset base in the Americas and strong development and exploration pipeline will further diversify the geography of our portfolio, creating a top-four global gold major, well-positioned to deliver long-term value creation.”
Subject to preceding conditions, the transaction is planned to conclude in the second half of this year.
Yamana Gold executive chairman Peter Marrone said: “The transaction delivers an immediate and compelling premium for Yamana Shareholders, reflecting the inherent fair value of our assets while also offering an opportunity to benefit from the creation of a new global gold producer with an attractive value proposition.”
Gold Fields holds nine operating mines in Australia, South Africa, Ghana, Chile, and Peru. The firm is also a partner in the Asanko joint venture in Ghana.
Yamana Gold’s gold and silver assets are located in the Americas, including Canada, Chile, Brazil, and Argentina.
The company has five producing mines, namely include Cerro Moro, El Peñón, Canadian Malartic, Jacobina, and Minera Florida.