Gold Fields offers $420m to buy out minorities in Peruvian subsidiary

  JOHANNESBURG ( − The world’s fourth-largest gold-miner Gold Fields on Tuesday launched an offer to acquire the remaining shares in its Peruvian subsidiary La Cima, for 1,16-billion nuevos soles, or $420-million.

CEO Nick Holland said the offer was consistent with the company’s view that, where possible, it should own 100% of the assets in the group’s portfolio.

Gold Fields wants to buy the remaining 19% of Cerro Corona, which is currently run by La Cima.

The openpit mine, in the Andes mountains in northern Peru, has gold-equivalent reserves of 5,3-million ounces. If the offer is accepted in full, it would give Gold Fields access to an additional one-million ounces of long-life and low-cost reserves and an additional 76 000 oz of gold-equivalent production a year, Holland said.

Gold Fields offered to pay 4,20 nuevos soles, or $1,45, in cash for each common or investment share in La Cima. The offer price represents a 30% and a 34% premium over the six-months average traded price of the common shares and investment shares respectively.

La Cima’s share structure is made up of 1,257-million common shares with full voting rights and 176-million non-voting investment shares.

"Through our cash offer La Cima shareholders are also getting a significant premium on what is a fairly illiquid stock," Holland said.

The offer would close by mid-April, or 20 trading days after March 21, 2011.

Gold Fields is based in South Africa, where it operates four mines, and also owns operations in Ghana and Australia.