The chief executive of South Africa’s Gold Fields said on Wednesday he was aware of a bid rumour that sent its shares surging, but that the firm has not been approached about a takeover.
”We have been aware of a rumour, but we have not been approached and frankly we never, ever comment on any unsubstantiated rumours, and at this stage it’s unsubstantiated,” Ian Cockerill told Reuters.
Bloomberg News reported that United States financier Edward Pastorini may lead a bid for Gold Fields, the world’s fourth biggest gold producer.
The report said a group led by Pastorini, which includes rival gold mining firms, plans to make a cash and share offer as early as June, Bloomberg said, citing internal documents.
Gold Fields has a market capitalisation of about R95-billion following a jump in its shares.
The shares surged 11,1% to a peak of R152,50, but pared gains to trade 6,3% firmer at R145,80 by 11.20am GMT, outpacing a slightly weaker Johannesburg Top-40 index of blue-chip stocks.
”If the bid is true, then it pretty much underlines our thinking on the value that Gold Fields presents, but it’s a question of how plausible, how true, how serious is that offer,” said Mandla Mapondera at Old Mutual Investment Group in Cape Town.
Old Mutual owns shares in Gold Fields, but Mapondera declined to say how many.
‘Stay private’
Bloomberg said it communicated with Pastorini through a telephone interview and e-mails from San Francisco and quoted him as saying he preferred to stay private.
The group planned to pay for Gold Fields in cash, shares in the four or five gold firms participating in the offer and bullion ”dividends”, Pastorini was quoted as saying.
No further information on Pastorini was available and an internet search came up with nothing.
A Johannesburg trader said Pastorini sounded like a private equity player. ”Quite interesting that a private equity buyout would look at a company like that,” he said.
”I suppose investors should be aware that Harmony has a big stake in Gold Fields shares and the buyout could lead to a re-rating of the sector.”
Harmony received a 2,75% stake in Gold Fields when it tendered its stake in Western Areas to Gold Fields in December.
Gold Fields took over Western Areas as part of a $2,5-billion acquisition of South Africa’s South Deep mine, which has the world’s largest gold deposit.
Gold Fields also owns three other mines in South Africa and has operations in Ghana, Australia and Venezuela.
The firm successfully fought off a hostile takeover bid from Harmony Gold, the world’s fifth ranking gold producer, during a bitter eight-month battle in 2004-2005. – Reuters