Overview of the Acquisition#
Zijin Mining is set to acquire control of Chifeng Gold in a deal valued at approximately 18.26 billion yuan, or $2.5 billion. This acquisition will be executed through a combination of purchasing A shares and a private placement of H shares.
Details of the Deal#
Under the agreement, Zijin Mining’s subsidiary, Zijin Gold, will buy 242 million A shares at a price of 41.36 yuan each. This price reflects a 1.3% premium over the last closing price before the trading suspension. The total cost for these shares will be around 10 billion yuan. Additionally, Zijin will subscribe to 311 million newly issued H shares at HK$30.19 each, amounting to approximately 9.39 billion HKD, or about 8.25 billion yuan.
Financial Implications#
The total investment implies a price-to-earnings ratio of about 11.6 times Chifeng’s projected earnings for 2026, based on consensus estimates. After the acquisition, Zijin Mining will own 25.85% of Chifeng Gold’s expanded share capital, gaining control of the company. Prior to this deal, Zijin held 19 million shares of Chifeng.
Chifeng Gold's Operations#
Chifeng Gold operates six gold mines and one multi-metal mine across China, Southeast Asia, and West Africa. In 2025, the company produced 14.5 tonnes of gold and aims to increase production to 14.7 tonnes in 2026. Chifeng reported a net profit of 3 billion yuan for 2025 and held 583 tonnes of gold resources at a grade of 1.54 grams per tonne by the end of that year. Zijin Mining has expressed interest in exploring Chifeng’s projects located in Laos, Ghana, and Liaoning province.
Approval Process#
The acquisition is subject to approval from Chifeng’s shareholders and the Anti-monopoly Bureau of the State Administration for Market Regulation in China.