Gold Road Resources (ASX: GOR) has formally rejected an unsolicited takeover proposal from its joint venture partner, Gold Fields Limited.
The offer, made on March 7, 2025, after market close, proposed acquiring 100 per cent of Gold Road’s shares through a scheme of arrangement.
The terms included a cash payment of $2.27 per share plus a variable amount reflecting each shareholder’s proportionate interest in Gold Road’s stake in De Grey Mining Ltd.
After thorough deliberation, the Gold Road Board unanimously deemed the offer “highly opportunistic” and concluded it materially undervalued the company.
The board cited several factors underpinning its decision, including the timing of the offer, which coincided with reduced production in the March quarter due to maintenance issues at the Gruyere mine.
Additionally, Gold Fields’ proposal failed to account for the potential underground expansion of the Gruyere mine — a key growth opportunity for Gold Road.
An 18-month drilling program to assess Gruyere’s underground potential has been completed, with results expected to reveal significant upside value.
Gold Road expressed disappointment in Gold Fields’ decision to publicise the offer rather than address concerns privately.
Despite engaging in good faith discussions, Gold Fields declined to amend its proposal.
Furthermore, Gold Road countered with an alternative offer to acquire Gold Fields’ 50 per cent stake in the Gruyere Joint Venture, which was promptly rejected.
The Gruyere mine, located in Western Australia, is a flagship asset jointly owned by Gold Road and Gold Fields.
While Gold Fields sought full control of the mine through this acquisition bid, Gold Road emphasised that its rejection reflects confidence in its independent growth strategy.
The company highlighted its substantial stake in De Grey Mining as another source of value for shareholders.
Gold Road also pointed out that under existing joint venture agreements, Gold Fields is restricted from acquiring more than a 10 per cent interest in Gold Road without prior notification.
To date, no such notification has been received.
To support its strategic response, Gold Road has engaged Gresham Partners as its financial adviser and Corrs Chambers Westgarth as its legal adviser.
The company remains committed to maximising shareholder value while advancing exploration and expansion opportunities at Gruyere and beyond.
