Shandong Gold to Buy $2.1 Billion of Mining, Production AssetsBloomberg News
Shandong Gold Mining Co., China’s second-largest gold company by value, plans to buy about 13 billion yuan ($2.1 billion) of production and mining assets from its parent and four other parties.
Shandong Gold will finance part of the purchase with a 9.98 billion yuan share swap, according to a statement to the Shanghai Stock Exchange yesterday. The company will raise as much as 3 billion yuan through a private share sale to 10 unidentified investors to fund the remainder, it said.
The company is seeking acquisitions as demand for the bullion in the Asian nation is set to rise. China may overtake India as the largest gold consumer this year as regulators make investing in the metal easier, according to the China Gold Association. The world’s second-largest economy approved its first two domestic ETPs backed by the metal this month.
Gold output in China, the world’s largest producer, is poised to rise almost 10 percent this year to a record even as bullion prices slump, the nation’s mining association said this month.
Yesterday’s acquisitions aim at strengthening gold reserves, expanding production, and improving competitiveness, Shandong Gold said.
The miner’s shares have been suspended since April 3, pending an announcement on a major asset restructuring, the company said in an exchange statement on April 2.
— With assistance by Liza Lin