African gold producer Acacia Mining is holding preliminary discussions with Canadian firm Endeavour Mining to explore the potential of merging.
The company said in a statement that these discussions could result in an agreement, which would potentially create a £3bn mining company, reported Financial Times.
If the merger happens, it will bring together Acacia’s assets in Kenya, Burkina Faso, Tanzania, and Mali along with Endeavour’s projects in Côte d’Ivoire, Mali, Ghana and Burkina Faso.
This deal will also provide the new merged entity with more resources and scope to continue with exploration activities throughout Africa.
With global gold prices steadily increasing since late-2015, the confidence of miners has been boosted and they intend to expand assets.
Gold prices reached a peak of $1,800 per ounce in 2011, but fell to around $1,000 in early 2015.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
In March 2016, Endeavour acquired True Gold Mining. This deal gave Endeavour access to Burkina Faso.
Headquartered in London, Acacia has been operating in Tanzania for more than a decade and is one of the largest gold producers in the African country.
Image: Acacia Mining's Bulyanhulu Gold Mine in Tanzania. Photo: courtesy of Acacia Mining.