Vancouver-based Montage Gold (MAU.V) announced on Tuesday a significant development in its strategic alliance with Chinese mining giant Zijin Mining Group (601899.SS). Zijin Mining is set to acquire a 9.9% stake in Montage Gold through a brokered private placement, marking a pivotal move in the global mining landscape.
Under the terms of the agreement, Zijin Mining will purchase 32.7 million shares at C$1.75 per share, amounting to approximately C$57.3 million ($41.90 million) upon the completion of the transaction by August 12.
The investment underscores Zijin Mining’s confidence in Montage Gold’s growth prospects and operational capabilities. For Montage Gold, the partnership represents not only a financial boost but also a strategic alignment with one of China’s leading mining firms.
Importantly, Montage Gold clarified that the transaction does not trigger a review under Canada’s Investment Canada Act. This exemption is based on several factors: Zijin Mining’s ownership will remain below the 10% threshold post-transaction, gold is not classified as a critical mineral by Canadian standards, and Montage Gold’s operational assets are located outside of Canada.
The announcement comes amid broader scrutiny in Canada over foreign investments, particularly in strategic sectors deemed critical to national security. However, Montage Gold remains confident that its partnership with Zijin Mining will proceed smoothly, emphasizing the mutual benefits and alignment of strategic goals between the two companies.
By forging this alliance, Montage Gold positions itself strategically to leverage Zijin Mining’s expertise and financial backing while expanding its footprint in the global mining sector. The transaction is expected to close swiftly, pending customary closing conditions and regulatory approvals.
The strategic investment by Zijin Mining represents a vote of confidence in Montage Gold’s vision and operational strategy, paving the way for enhanced collaboration and growth in the years ahead.
Dailygoldprice provides you with live gold prices so that you can always understand the changes in the price of gold and better invest in gold.