Mid-tier gold production and exploration company Gold Road Resources (ASX: GOR) announces that it has entered into a Scheme Implementation Deed with Gold Fields (JSE: GFI) under which Gold Fields has agreed to acquire 100 per cent of the issued share capital in Gold Road by way of a scheme of arrangement.
Gold Road’s principal asset is a half-share in the world-class Gruyere gold mine, in Western Australia’s north-eastern Goldfields. The Gruyere JV is a 50:50 joint venture with Gold Fields, which manages and operates the Gruyere gold mine. In addition, Gold Road also has a significant investment and exploration portfolio that included a 17.3% stake in De Grey Mining, which is in the process of being taken over by Northern Star Resources.
Under the terms of the Scheme, Gold Road shareholders will receive a fixed cash consideration of A$2.52 per share (less any special dividend paid prior to implementation of the Scheme) plus a variable cash consideration equal to the full value of each Gold Road shareholders’ proportionate holding in Northern Star, calculated by reference to the date the Scheme becomes effective (valued at A$0.88 per share if the Scheme was effective on 2 May 2025).
As at 2 May 2025, the total cash consideration equates to A$3.40 per share, representing a 43 per cent premium to Gold Road’s undisturbed closing share price on 21 March 2025, and a 39 per cent premium to Gold Road’s undisturbed 3-month VWAP on 21 March 2025. As at 2 May 2025 the value of the total cash consideration is 12 per cent higher than the value of the consideration proposed in the initial non-binding indicative offer announced by Gold Fields on 24 March 2025.
Gold Road intends to declare a fully franked special dividend should the Scheme become effective. The final amount will be determined by Gold Road’s franking account balance at the relevant time. Based on Gold Road’s current franking account balance, the dividend would equate to approximately A$0.353 per share.
Gold Fields has confirmed to Gold Road that the consideration proposed under the Scheme is a ‘best and final’ price and will not be increased further in the absence of a superior proposal emerging.
The Scheme is subject to various conditions including approval by Gold Road shareholders at a Scheme Meeting expected to be held in September 2025, with implementation of the Scheme expected to occur shortly thereafter.
Shareholders representing 7.5 per cent of Gold Road’s total shares outstanding have provided confirmation to Gold Fields that they intend to vote all of the shares they own or control in favour of the Scheme.
The Gold Road Board unanimously recommends that shareholders vote in favour of the Scheme, in the absence of a superior proposal and subject to the independent expert concluding in the Independent Expert’s Report, and continuing to conclude, that the Scheme is in the best interests of Gold Road shareholders.
