Wrap Text
Non-binding indicative proposal to acquire Gold Road Resources Limited and cautionary announcement
Gold Fields Limited
(Reg. No. 1968/004880/06)
Incorporated in the Republic of South Africa
JSE, NYSE, DIFX Share Code: GFI
ISIN Code: ZAE000018123
("Gold Fields" or the "Company" or the "Group")
NON-BINDING INDICATIVE PROPOSAL TO ACQUIRE GOLD ROAD RESOURCES LIMITED AND CAUTIONARY
ANNOUNCEMENT
Gold Fields has provided a non-binding, indicative and conditional proposal to the Board of
Gold Road Resources Limited ("Gold Road") to acquire 100% of the issued and outstanding
share capital in Gold Road by way of a scheme of arrangement (the "Proposed Acquisition",
the "Proposal").
The Proposal to acquire Gold Road was for a cash consideration of A$3.05 per share as of 7
March 2025. This consideration comprised a fixed portion of A$2.27 per share plus a variable
portion equal to the value of each shareholders' proportion of Gold Road's shareholding in
De Grey Mining Ltd ("De Grey") ("Offer Price")(1).
The Proposed Acquisition would consolidate Gold Fields' ownership of Gruyere, a low-cost,
long-life producing gold mine in Western Australia in which Gold Road holds a non-operating
joint-venture interest. The Gruyere mine is operated by Gold Fields, making Gold Fields
uniquely positioned to put forward this compelling Proposal that recognises and provides
certainty of value to Gold Road shareholders.
Regrettably, the Proposal has been rejected by the Gold Road Board of Directors ("Gold Road
Board"). Despite subsequent discussions, Gold Fields is disappointed that the Gold Road
Board has not constructively engaged on key elements of the Proposal, which would have
allowed both parties to confidentially progress towards an outcome that would deliver
compelling and certain value to Gold Road shareholders.
As part of its rejection of the Proposal, Gold Road expressed a preference to enter into an
alternative transaction in respect of an acquisition of Gold Fields' 50% interest in the
Gruyere mine. Gold Road proposed this would be funded through a combination of (i) Gold
Road's existing cash; (ii) monetisation of Gold Road's marketable securities; (iii) existing
and / or new debt facilities; and (iv) issuing new equity.
Gold Fields has formally responded to Gold Road that it will not be progressing the
alternative transaction.
Under the Proposal, Gold Fields' intention is for Gold Road's shareholding in De Grey to be
voted in favour of Northern Star Resources Ltd's ("Northern Star") proposed acquisition of
De Grey, in the absence of a superior proposal in relation to that transaction. As at the
date of this announcement, Gold Fields has no intention to present a 'competing proposal'(2)
in connection with De Grey and is committed to seeing the full benefit of the De Grey/Northern
Star equity position being delivered to Gold Road shareholders as part of the Proposed
Acquisition.
Gold Fields maintains a strong balance sheet and is confident in its ability to finance the
Proposed Acquisition in line with the Company's capital allocation framework. Gold Fields
is confident that the foreign investment approval required under Australian law will be
received in a timely manner given its longstanding position in Gruyere and Australia more
broadly.
As of 21 March 2025, the envisaged Offer Price is A$3.05 per share. The Offer Price values
Gold Road's equity at A$3.3 billion and implies a total enterprise value of A$2.4 billion(3).
Based on Gold Road's closing share price on 21 March 2025 of A$2.38 per share, the Offer
Price represents significant premia of:
• 28% premium to Gold Road's closing share price;
• 44% premium to the see-through valuation for Gold Road after adjusting for the
value of the De Grey shares held by Gold Road ("see-through basis"), based on De
Grey's closing share price of A$2.10 on 21 March 2025;
• 21% premium to Gold Road's 30-day volume-weighted average share price which equates
to 31% on a see-through basis;
• 25% premium to Gold Road's 3-month volume-weighted average share price which
equates to 36% on a see-through basis; and
• 41% premium to Gold Road's 6-month volume-weighted average share price which
equates to 54% on a see-through basis.
These premia are even more significant when considering that Gold Road does not control
either of its major interests.
Mike Fraser, Chief Executive Officer of Gold Fields 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.
The Proposed Acquisition would crystallise significant value for Gold Road shareholders in
a volatile market. It would also consolidate ownership of an attractive cash producing asset
that is expected to support greater capital returns to Gold Fields shareholders going
forward.
Gold Fields will remain disciplined with regards to the Proposed Acquisition of Gold Road
and prudent in its acquisition strategy to ensure continued maximisation of shareholder
value. Gold Fields also remains committed to maintaining a strong balance sheet with
sufficient access to liquidity and funding to finance the Proposed Acquisition."
Given the nature of the Proposed Acquisition, there can be no certainty that any further
engagements will materialise in a transaction being successfully concluded and, accordingly,
Gold Fields shareholders are advised to exercise caution when dealing in Gold Fields'
securities until any further announcement is published.
This announcement is being made by Gold Fields without prior agreement or approval of Gold
Road.
(1) Value calculated based on the 30-day VWAP of the De Grey shares as at, or Northern Star shares if
the De Grey scheme of arrangement has already completed prior to, the period 5 business days prior
to the Effective Date of the Proposed Acquisition.
(2) As defined in the 'Scheme Implementation Deed' dated 1 December 2024 between Northern Star and De
Grey.
(3) Enterprise value calculated based on Gold Road's latest reported balance sheet as at 31 December
2024, which included net cash of A$174 million, lease liabilities of A$119.5 million, De Grey stake
of A$869.3 million and other listed investments of A$11.8 million as at 21 March 2025.
ENDS
24 March 2025
For investor enquiries contact:
Jongisa Magagula
Tel: +27 11 562 9775
Mobile: +27 82 562 5288
Email: Jongisa.Magagula@goldfields.com
Thomas Mengel
Tel: +27 11 562 9849
Mobile: +27 72 493 5170
Email: Thomas.Mengel@goldfields.com
For media enquiries contact:
Claire Walker
Tel: +61 447 391 261
Email: Claire.Walker@goldfields.com
VECTOR Advisors (Australia)
John Gardner
Mobile: +61 413 355 997
Matt Worner
Mobile: +61 429 522 924
JSE Sponsor: J.P. Morgan Equities South Africa (Pty) Ltd
Financial advisor to Gold Fields
J.P. Morgan
Legal Advisors to Gold Fields
Herbert Smith Freehills (Australia)
Webber Wentzel (South Africa)
Media advisor to Gold Fields
VECTOR Advisors (Australia)
About Gold Fields
Gold Fields is a globally diversified gold producer with nine operating mines in Australia,
South Africa, Ghana, Chile and Peru and one project in Canada. We have total attributable
annual gold-equivalent production of 2.1Moz, proved and probable gold Mineral Reserves of
44.3Moz, measured and indicated gold Mineral Resources of 30.4Moz (excluding Mineral
Reserves) and inferred Gold Mineral Resources of 11.6Moz (excluding Mineral Reserves). Our
shares are listed on the Johannesburg Stock Exchange (JSE) and our American depositary shares
trade on the New York Exchange (NYSE).
Forward-looking statements
This announcement contains forward-looking statements. All statements other than
statements of historical fact included in this announcement may be forward-looking
statements. Forward-looking statements may be identified by the use of words such as
"aim", "anticipate", "will", "would", "expect", "may", "could", "believe", "target",
"estimate", "project" and words of similar meaning.
These forward-looking statements, including among others, those relating to the Proposed
Acquisition and the Proposal, Gold Fields' future business strategy, development
activities and other initiatives, business prospects, financial positions, production
and operational guidance are necessary estimates reflecting the best judgement of the
senior management of Gold Fields and involve a number of risks and uncertainties that
could cause actual results to differ materially from those suggested by the forward-
looking statements. By their nature, forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances and should be
considered in light of various important factors, including those set forth in Gold
Fields' Integrated Annual Report 2023 filed with the Johannesburg Stock Exchange and
annual report on Form 20-F filed with the United States Securities and Exchange
Commission (SEC) on 28 March 2024 (SEC File no. 001-31318). Readers are cautioned not
to place undue reliance on such statements. These forward-looking statements speak only
as of the date they are made. Gold Fields undertakes no obligation to update publicly
or release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this announcement or to reflect the occurrence of
unanticipated events. These forward-looking statements have not been reviewed or
reported on by the Company's external auditors.
Date: 24-03-2025 07:05:00
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