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'The gold sector is highly fragmented'- Gold Fields Mike Fraser on consolidation in the mining space

Kitco MediaKitco Media
By Michael McCrae and Paul Harris
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'The gold sector is highly fragmented'- Gold Fields Mike Fraser on consolidation in the mining space teaser image

(Kitco News) - There are more opportunities for consolidation in the gold sector, said Mike Fraser, CEO of Gold Fields.

This week Fraser spoke to Kitco Mining at the Gold Forum Americas / XPL-DEV 2024 in Colorado.

Headquartered in South Africa, Gold Fields is a 918,000 ounce gold producer. In 2022 Gold Fields tried to acquire Yamana Gold. Agnico Eagle Mines prevailed after Gold Fields' investors soured on the deal. Gold Fields CEO Chris Griffith left the company. Fraser took over in October 2023.

Fraser discussed Gold Fields other purchase, Osisko Mining's Windfall in Quebec. Gold Fields had initially acquired a 50% stake in the project 18 months ago. Recently Gold Fields completed the acquisition by purchasing the remaining 50% for C$2.16 billion.

Fraser explained that the two-phased acquisition allowed the company to gradually familiarize itself with the Quebec jurisdiction and operational conditions before fully committing.

"I think the way it's played out has really been the best way possible for Goldfields to enter into 100 percent of that asset," said Fraser.

The Windfall project, which holds 7.4 million ounces of gold reserves, is seen as a strategic move by Gold Fields. Despite a 55% premium on the second tranche, Fraser highlighted that the acquisition came with several financial benefits, such as cash already on hand and relief from funding further exploration. He described the acquisition price as fair, considering the future value it will generate.

"M& A is only one leg of our strategy to grow and improve the quality of our portfolio," said Fraser. "We also have a very strong brownfields program where we explore around our existing projects, but ...[these] bolt-on acquisitions are really going to be opportunities to move forward. The gold sector is highly fragmented...compared to other industries, and there definitely are opportunities for further consolidation."

Coverage of the Gold Forum Americas / XPL-DEV 2024 is sponsored by Metalla Royalty.

 

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Kitco Media

Michael McCrae

Michael McCrae is leading Kitco's coverage of the mining sector. McCrae, who has both an MBA and CMA, knows how to build digital media properties. He was co-founder and publisher of MINING.com, an award-winning news site. Before coming to media, McCrae worked in IT and banking. Please reach out: mmccrae@kitco.com or (514) 670-1383. You can also follow him at @michaelmccrae.

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Paul Harris

Paul has more than 20 years of experience in the mining sector in investor relations, communications, research, and news reporting roles, and over 16 years of experience in the Colombia gold sector. Paul founded the successful CGS Copper and Gold Symposium in Colombia. He has written for the industry-leading publication ‘Mining Journal’ since 2015 and has been a Kitco Mining anchor since 2022. Previously, Paul spent five years in Chile reporting on the copper sector for CRU and Metal Bulletin. Paul received a BA in Business Administration from the University of the West of England, UK; and a MA in International Relations from the University of Chile, Santiago Chile. He is fluent in English and Spanish.

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South AfricaGold FieldsMike FraserGold Forum Americas / XPL-DEV 2024Podcasts

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