South Africa’s Gold Fields in a groundbreaking deal has acquired Osisko Mining, a Canadian mining company in a US$1.6 billion transaction.
This purchase of Osisko Mining by the Africa-based company comes two years after Goldfields failed in its attempt to acquire another Canadian gold mining company, Yamana Gold.
According to the Johannesburg company, the new move to purchase Osisko is part of its broader plan to expand its influence in the gold mining industry in America. Canada it’s the latest American country where Gold Fields have acquired mines apart from Chile and Peru.
As part of its plans to diversify its portfolios beyond its home country, the world mining giant also has mines in Ghana and Australia.
Gold Fields is expected to pay C$4.90 per share at a 55% premium indicating that the agreed shared price for the deal is 55% higher than what Osisko’s shares were worth on August 9th.
With this buyout, Gold Fields becomes the sole owner of the Windfall Project in Quebec, Canada which before the acquisition, was co-owned by both companies at a 50/50 stake.
Chief Executive Officer of Gold Fields, Mike Fraser in a statement indicated that “over the past two years, beginning with our initial due diligence in 2022 and throughout our joint ownership of the project since May 2023, we have developed a strong understanding of Windfall and its potential, and view it as the next long-life cornerstone asset in our portfolio.”
“In the span of nine years, we’ve transformed Windfall into one of the largest and highest-grade gold development projects globally, and this transaction is a testament to the extraordinary entrepreneurial effort of the Osisko Mining team,” Chairman and CEO of Osisko Mining, John Burzynski who confirmed the deal in a separate statement.
It is estimated that Goldfields could ramp up about 300,000 ounces of gold annually from this newly acquired Canadian mine when it begins production by the end of 2026 or early 2027.
AngloGold Ashanti, one of the mines of Gold Fields has experienced a significant decline in gold production over the years. According to data from Statista, between 2010 and 2023, production was the highest in 2010 when 4.5 million ounces were produced. Production fluctuated on a downward trend until 2020 when it reached the lowest point of 2.4 million ounces.
Some analysts say the reduction in production is a result of the aging mine.
These aging mines in Ghana and Peru are some of the reasons why Gold Fields are seeking new frontiers of production.
