DRDGOLD Limited (NYSE:DRD) shareholders have given their backing to a “step-change” deal, which will see the South African miner acquire the West Rand Tailings Retreatment Project from Sibanye-Stillwater.
New York-listed DRD first announced the deal, which is valued at 1.3bn Rand (US$110mln), towards the end of 2017.
READ: Link to full news release
As part of the acquisition, DRD will issue 265mln shares to Sibanye-Stillwater, equivalent to a 38% stake.
Sibanye-Stillwater also has the option to increase its holding in DRDGold to up to 50.1% within 24 months, while a mandatory offer by Sibanye-Stillwater to DRDGOLD’s other shareholders is waived.
“This transaction is a step-change for DRDGOLD. We have doubled our reserves and secured infrastructure to access these very quickly,” said chief executive Niël Pretorius.
“After many years of consolidation this is a major advance towards growing our company.”
The WRTRP acquisition will almost double the company’s gold reserves from 2.99mln ounces (Moz) to 5.75Moz.
Shares were down 0.36% to US$2.74 in mid-afternoon trading on Thursday.