Key facts
- Zijin Mining and Allied Gold terminated their C$5.5 billion buyout agreement.
- Zijin Mining will purchase a 9.2% stake in Allied Gold for $295 million.
- The companies cited no reasonable likelihood of meeting remaining conditions for the sale.
- Allied Gold plans to use the proceeds for growth initiatives, including mine development and expansion.
- Allied Gold's U.S.-listed shares fell nearly 15% in premarket trading.
Zijin Mining and Allied Gold have mutually agreed to terminate their planned C$5.5 billion ($3.9 billion) buyout of the Canadian miner. Instead, Zijin will acquire a 9.2% stake in Allied Gold for approximately $295 million, with the transaction expected to close around August 10.
The companies stated that there was "no reasonable likelihood" the remaining conditions for the sale would be met within a reasonable period, citing broader external factors affecting large-scale cross-border transactions. Allied Gold operates gold mines and development projects in Ivory Coast, Mali, and Ethiopia, while Zijin Gold has mining operations globally.
The initial deal was announced in January, with Zijin agreeing to acquire Allied for C$44 per share. Under the new agreement, Zijin will subscribe for about 12.8 million newly issued Allied shares at C$32.55 per share in a private placement. Allied Gold intends to use the proceeds to advance growth initiatives, including completing and ramping up the Kurmuk mine in Ethiopia, expanding the Sadiola mine in Mali, increasing production in Ivory Coast, and funding exploration activities.