Eldorado acquires rival, cements top Aegean spot

TORONTO

Eldorado, the gold miner also active in Turkey, has acquired European Goldfields for $2.4 billion, according to executives.

Eldorado Gold said on Dec. 18 it has agreed to acquire smaller rival European Goldfields for about C$2.5 billion ($2.4 billion), in a move aimed at expanding its asset base in Greece and Turkey.

The deal enhances Eldorado’s project pipeline and it will create a low-cost gold miner with significant liquidity and the financial heft necessary to fund its many development projects, Reuters reported.

Turkish facilities
In Turkey, Eldorado operates the Kışladağ gold mine in Uşak and the Efemçukuru gold mine in İzmir. According to the company website, Eldorado has allocated $13 million for exploration projects in Turkey. These include the Konya-Sızma gold prospect in southcentral Turkey.

“We are extremely pleased to have reached this mutually beneficial transaction,” said Eldorado’s chief executive, Paul Wright.

“Integration of European Goldfields’ business with our own will provide Eldorado with the dominant gold mining business in the Aegean Region,” the executive said.

The offer represents a nearly 50 percent premium to European Goldfields closing share price on the Toronto Stock Exchange on Dec. 5, Reuters said.

European Goldfields has long been seen as a potential target for rivals, particularly after it received this year a much-delayed Greek mining permit that could turn it into a mid-tier miner and one of Europe’s largest primary gold producers.

Eldorado, which owns six operating mines spread across Asia, Europe and South America, was long viewed as a potential suitor, due to the project overlap that the two companies have in Greece and Turkey.

The two companies will have combined current gold production of about 650,000 ounces, with output growing to more than 1.5 million ounces by 2015, as some of their development projects come into production.