Gold Fields launches R4bn bookbuild to fund Chilean mine

Multinational gold producer Gold Fields has announced its intention to place new shares with a view to raising around R4 billion ($269 million) in order to develop its Salares Norte silver-gold mine project in Chile. 

The share placing, which represents around 5% of the company's existing ordinary shares, will be done through an accelerated bookbuild launched immediately.

JP Morgan will act as sole global coordinator, and  JP Morgan and BMO Capital Markets will act as joint bookrunners.

Salares Norte is expected to have an initial 11.5 year life of mine, with an average annual production of 450 000 ounces of gold over the first seven years, according to Gold Fields. Production is expected to kick off in 2023. 

"In order to progress with the construction of the Project, the board of directors of Gold Fields (the “Board”) has been formulating its funding strategy," Gold Fields said.

"Following a review of the alternatives available to the Company and consistent with the Company’s prudence regarding its debt position, the Board believes that a combination of the proceeds of the Placing, operational cash flow and existing debt facilities will allow the Company to fully fund the construction of Salares Norte, and allow Gold Fields to maintain a 10% interest in this world-class project and exploration district."

Gold Fields' shareholder notice said the listing and trading of the placing shares on the JSE was expected to commence next week Tuesday morning or another time and date agreed between the Gold Fields and JP Morgan.

The shareholder notice said the price per ordinary share would be decided at the close of the bookbuild, and announced through another shareholder notice after the bookbuild's close.

"The timing of the closing of the bookbuild, the placing [rice and allocations are at the discretion of the company and the managers," Gold Fields said.

Gold Fields also reported a jump in earnings on Wednesday, thanks to higher production and a decrease in costs. 

Reporting its results a day earlier than expected, Gold Fields also declared a 91 of 100 cents per share final dividend.

ZAR/USD
17.12
(-1.35)
ZAR/GBP
21.82
(-1.04)
ZAR/EUR
19.92
(-0.89)
ZAR/AUD
12.04
(-0.89)
ZAR/JPY
0.16
(-1.10)
Gold
1862.80
(-0.18)
Silver
22.94
(-1.01)
Platinum
851.00
(+0.53)
Brent Crude
42.26
(+0.47)
Palladium
2213.00
(+0.25)
All Share
53587.11
(-1.22)
Top 40
49547.74
(-1.16)
Financial 15
9401.28
(-1.95)
Industrial 25
72949.70
(-1.72)
Resource 10
53453.42
(-0.10)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes. We need the money.
11% - 1365 votes
It depends on how the funds are used.
73% - 8840 votes
No. We should have gotten the loan elsewhere.
16% - 1954 votes
Vote