Speaking of gold M&A – god we’re obsessed – two of the leading candidates to make a play at De Grey Mining (ASXEG) and its 10.5Moz Hemi discovery are flanking De Grey boss Glenn Jardine on Tuesday
Johannesburg-headquartered Gold Fields has its new CEO Michael Fraser in town, the owner of the St Ives, Agnew and Gruyere gold mine touted as one party with a horse in the DEG race.
Another, strongly rumoured contender, is Agnico Eagle. The third-largest gold miner in the world and owner of the rich Fosterville operation in Victoria talks in the next session after Jardine, Gold Fields, which has a massive presence in the Goldfields, is before.
That said, DEG has long spoken about bringing Hemi into production on its own. The Pilbara mine could be one of the largest in Australia from 2026 at 530,000ozpa over its first 10 years, but it carries a capex of around $1.3bn, raising the question of whether a company level takeover of JV with an existing mining giant a la Gold Road Resources (ASX:GOR) will be more beneficial for shareholders.
It has shown the capacity to go it alone, at least from a financial standpoint. De Grey recently raised $600m in equity and received approved credit term sheets for ~$1.1bn in bank and government debt.
Among the other international players on the bill is an interesting name in K92 Mining, a C$1.8bn PNG gold miner with Aussie links and a very Aussie ticker code which thinks it can turn its Kainantu mine into a Tier-1 operation by 2026 through a staged expansion from ~120,000ozpa to 470,000ozpa at costs of under US$450/oz once by-product credits are calculated.
GOR Price at posting:
$1.75 Sentiment: Buy Disclosure: Not Held
EG), Gold Fields (JSE:GFI) & K92 Mining (TSX:KNT)
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