Chaarat Gold says Centerra refused $2B-offer for whole firm, not just for Kumtor mine

Chaarat Gold Holdings (LON:CGH), the company that tried and failed buying Centerra Gold’s (TSX:CG) Kumtor mine in Kyrgyzstan, revealed Wednesday the Canadian miner turned down an unconventional takeover proposal, valued at about $2 billion, for the entire company.

The Central Asia-focused gold miner revealed that last month it proposed buying the Toronto-based company in an-all cash transaction at 35 per cent above Centerra’s share price, which was then C$5.48 (about $4.17).

Chaarat’s goal was to gain control of Kumtor, Kyrgyzstan’s largest gold mine, but after Centerra rejected the unsolicited offer, it went for the entire company. The move was not disclosed by either company at the time.

"Due to the unwillingness of Centerra to engage with Chaarat, the Chaarat board is no longer pursuing either transaction," it said in the statement.

Chaarat noted its board still firmly believed in the strategic rationale for the Kumtor and Centerra proposals and was convinced that Chaarat was a "more natural long-term owner" of the Kumtor mine.

Centerra’s mine is located in the southern Tien Shan Metallogenic belt, in which Charaat owns a namesake project, comprising the Tulkubash and Kyzyltash deposits, which are set to yield 300,000 to 400,000 ounces of gold a year when in full production.

The news comes barely a day after it announced the potential acquisition of Polymetal's Kapan project in Armenia for $55 million.

Chaarat has not hidden its intention of becoming a major regional player in Central Asia, with an annual production of 1 million ounces, which it aims to reach through acquisitions.

More to come…

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