Gold Road’s takeover grip on $2.3b De Grey loosens
Peter KerResources reporter
May 10, 2024 – 11.57am
Listen to this article2 minGold Road’s strategic grip on Australia’s best undeveloped gold project will loosen after the acquisitive company subscribed for only a portion of the new De Grey Mining shares it is entitled to.
De Grey is raising $600 million to accelerate development of its Hemi gold project in Western Australia, which will
rank among Australia’s top five gold mines by volume if built to plan. The De Grey raising shaped as a sliding doors moment for Gold Road’s long-held takeover ambitions, which had previously seen it acquire 19.9 per cent of the pre-revenue developer, which now has a market capitalisation of $2.3 billion.
The Hemi project will be one of the largest gold mines once constructed.
Gold Road had $146.2 million of cash on hand at March 31, meaning it had the financial firepower to fully participate in the raising by spending $119.4 million to maintain its De Grey stake at 19.9 per cent.
But Gold Road announced on Friday that it would subscribe for only $50.8 million worth of new De Grey shares; a purchase that will see its stake diluted to just over 17 per cent.
Gold Road did not explain the rationale for its partial participation, but it suggests the company remains interested in spending its money on other investments.
(20min delay)