FIRB approves gold takeover

The Foreign Investment Review Board has given the green light to the takeover of Sino Gold by Canada's Eldorado Gold.

The Foreign Investment Review Board (FIRB) has given the green light to the takeover of Sino Gold by Canada’s Eldorado Gold.

In a statement released yesterday, Sino Gold announced FIRB’s unconditional approval of the friendly takeover, saying it satisfied the scheme implementation deed between the two companies.

Originally announced in August, the $1.76 billion deal will create a company with a market value of around US$6 billion, with gold reserves of 12 million ounces and resources of more than 23 million ounces, Sino Gold said.

Eldorado, which was already Sino Gold’s largest shareholder with a 19.83% stake, has offered 0.55 of its shares for each Sino Gold share, which it says values the company at approximately $2.2 billion.

As a Chinese-focussed company, Eldorado said Sino Gold represents a very attractive prospect for the Vancouver-based company.

“The business combination with Sino Gold enables Eldorado to realize its vision of establishing a leading presence in China,” Eldorado president and chief executive Paul Wright said.

Under the terms of the takeover, current Eldorado shareholders will own approximately 75% of the merged company while Sino Gold shareholders will own the remaining 25%.

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