The Peterborough Examiner

Endeavour pondering Teranga Gold deal

Gold producers are benefiting from recent rebounds in prices

- DINESH NAIR, RUTH DAVID AND THOMAS BIESHEUVEL

Endeavour Mining Corp., the acquisitiv­e gold miner backed by Egyptian billionair­e Naguib Sawiris, is exploring a purchase of Teranga Gold Corp. as it seeks to build scale, people with knowledge of the matter said.

Endeavour has held preliminar­y talks about an all-stock combinatio­n with Teranga, which would help it expand further in West Africa, according to the people. It is considerin­g offering a low premium for the Toronto-listed company and aims to reach a friendly deal, one of the people said, asking not to be identified because the informatio­n is private.

Gold producers are benefiting from a rebound in the price of the metal, which hit a record high in recent months. Shares of Teranga have gained 87 per cent this year, giving the company a market capitaliza­tion of about $2.2 billion. Endeavour is valued at about $5.2 billion in Toronto.

Deliberati­ons are at an early stage, and there’s no certainty they will come to an agreement, the people said. A representa­tive for Endeavour declined to comment. A spokespers­on for Teranga couldn’t immediatel­y comment. The gold industry has seen a flurry of dealmaking in the past few years, as smaller companies seek to combine or snap up assets following large transactio­ns by the two biggest producers. The spree was started when Barrick Gold Corp. agreed to buy Randgold Resources Ltd. in 2018, an allstock acquisitio­n that set the tone for low or zero premiums in precious-metal transactio­ns.

A successful deal would extend a years-long transforma­tion by Endeavour, which has replaced high-cost mines with two new flagship projects that produce more gold and will operate for much longer. Teranga has assets in Senegal, Burkina Faso and Ivory Coast.

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