- Mid-tier gold producer Gold Road Resources (GOR) makes $308 million bid for full control of ASX-listed DGO Gold (DGO) in a proposed all-scrip deal
- Gold Road is offering 2.16 GOR shares for every one DGO share, implying an acquisition price of $3.55 per share — a 37 per cent premium to DGO’s 30-day volume-weighted average price
- DGO’s board has unanimously recommended the takeover offer, which is subject to acceptance by at least 80 per cent of DGO shareholders
- Gold Road Managing Director and CEO Duncan Gibbs says the proposed DGO purchase aligns with the company’s strategy of investing in high-quality assets in tier-one jurisdictions
- DGO shares 14 per cent higher at $3.42 and GOR shares up 0.94 per cent to $1.61
Mid-tier gold producer Gold Road Resources (GOR) has lobbed a $308 million bid for full control of ASX-listed DGO Gold (DGO) in a proposed all-scrip deal.
DGO’s board has unanimously recommended the takeover offer, which would see Gold Road offer 2.16 Gold Road shares for every DGO share — equating to an implied offer price of $3.55 per share.
The price tag represents a 37 per cent premium on DGO’s 30-day volume-weighted average share price.
Gold Road’s proposed acquisition of DGO, while recommended by the DGO board, is subject to acceptance by at least 80 per cent of DGO shareholders.
Gold Road Managing Director and CEO Duncan Gibbs said the proposed transaction aligned with the company’s strategy of investing in high-quality assets in tier-one jurisdictions, particularly in light of DGO’s shareholding in De Grey Mining (DEG), who made the Hemi gold discovery.
DGO’s asset portfolio includes a 14.4 per cent interest in De Grey, a 6.8 per cent interest in Dacian Gold (DCN) and a 20.1 per cent interest in Yandal Resources (YRL).
“Gold Road views the substantial shareholding in the owner of the high-quality Hemi gold discovery, combined with our 50 per cent ownership of the Gruyere gold mine, as an exciting opportunity to participate in two of the most significant gold discoveries in Western Australia this century,” Mr Gibbs said.
DGO Executive Chairman Eduard Eshuys said he felt DGO had consistently traded at a discount to the value of its assets and the Gold Road offer recognised and unlocked the value of the company.
Gold Road will lodge a formal bidder’s statement for the deal to the ASX on Thursday, April 7.
DGO shares were trading 14 per cent higher at $3.42 and GOR shares were up 0.94 per cent to $1.61 at 12:47 pm AEST.