Darlot mine in Oz sold for A$18.5m

GOLD FIELDS yesterday announced the sale of its Darlot mine in Western Australia to ASX-listed gold producer, Red 5 for a total consideration of A$18.5 million (R195.11m), comprising A$12m in cash and 130 million Red 5 shares. The cash component is made up of A$7m up front and A$5m deferred for up to 24 months. The deferred consideration may be taken as additional shares in Red 5 or as cash at Gold Fields’ election. Gold Fields said Red 5 intends to undertake a rights issue in order to assist with the funding of the cash component and general working capital purposes, while Gold Fields will underwrite the rights issue up to A$7m. The sale of Darlot is in line with Gold Fields’ strategy to continually upgrade its portfolio. The commencement of the sale process was announced to the market in February 2017. Gold Fields is a globally diversified producer of gold with eight operating mines in Australia, Ghana, Peru and South Africa with a primary listing on the JSE, with secondary listings on the New York Stock Exchange and the Swiss Exchange. Darlot was acquired by Gold Fields in 2013 as part of the acquisition of Barrick Gold’s Yilgarn South assets. Gold Fields invested heavily to extend the life of the mine beyond the initial projected six months, which resulted in Darlot producing more than 241 000 ounces of gold in the past three years. Red 5’s acquisition of Darlot mine comes after its announcement that it plans a new growth strategy.– ANA