Eldorado Gold is pleased to announce that it has reached an agreement to sell its 82% interest in the company's Jinfeng mine to a wholly-owned subsidiary of China National Gold Group ("China National Gold") for US$300m in cash, subject to certain closing adjustments.
"We are pleased to have reached an agreement which we believe mutually benefits both companies. China National Gold has been our minority partner at Jinfeng for over fourteen years and is the logical buyer as the operation transitions fully into the underground," said Paul Wright, President and Chief Executive Officer of Eldorado Gold.
"Since commencement of production in 2007, Jinfeng has consistently delivered solid operating results and has been a strong contributor in Eldorado’s global portfolio."
The transaction is expected to close in the third quarter 2016 and is subject to obtaining various regulatory and other approvals and other customary closing conditions.
As previously disclosed, Eldorado has been evaluating the merits of potentially monetizing its Chinese assets. The Company continues to advance this process and has been in discussions with various parties and will update shareholders as appropriate.
BMO Capital Markets and Cutfield Freeman & Co. are acting as financial advisors and Fasken Martineau DuMoulin LLP, Herbert Smith Freehills LLP, Morrison & Foerster LLP and JunHe LLP are acting as legal counsel to Eldorado. GMP Securities L.P. is acting as financial advisor and Borden Ladner Gervais LLP is acting as legal counsel to Eldorado’s Board of Directors.
Eldorado is a leading low cost gold producer with mining, development and exploration operations in Turkey, China, Greece, Romania and Brazil. The Company’s success to date is based on a low cost strategy, a highly skilled and dedicated workforce, safe and responsible operations, and long-term partnerships with the communities where it operates.
China National Gold is the leading gold company in China and the only central state-owned enterprise in China’s gold industry under the direct supervision of State-owned Assets Supervision Administration Commission of the State Council.