China’s Zijin Mining to buy Canada’s Continental Gold

China’s Zijin Mining has agreed to buy Canada’s Continental Gold for around CAD1.4bn in cash in a deal that will boost its gold reserves and cash flow.

Under the terms of the transaction, Zijin - which specialises in gold, copper, zinc and other mineral resource exploration and development - will pay CAD5.50 per share for each Continental share. The offer represents a 13% premium to Continental’s closing share price on Friday.

Zijin’s chairman, Chen Jinghe, said: "Continental's 100%-owned Buriticá project in Antioquia, Colombia is one of the largest and highest-grade gold projects in the world and represents a highly complementary addition to Zijin's international asset portfolio."

Continental chief executive officer Ari Susseman said: "The all-cash offer at a significant premium to market is an excellent outcome for our shareholders and is a testament to the extraordinary effort of the Continental team and its stakeholders in pioneering a new and modern gold industry in Colombia.

"With production on the horizon in 2020, the timing is right for Continental to sell to a more experienced mine operator and therefore Continental's board of directors recommends that shareholders vote in favour of the transaction. Zijin is one of the world's fastest growing mining companies and boasts an impressive track record of successful international acquisitions and operations."