Aurion sheds stake in Zimbabwe platinum miner

Vancouver — Australian gold miner AurionGold has sold its 21% interest in Australian-listed Zimbabwe Platinum Mines (Zimplats) for A$35.3 million.

Impala Platinum Holdings picked up the shares at A$1.90 each. Zimplats shares last traded at A$1.33 each.

AurionGold described Zimplats as a “non-core asset” and said all proceeds from the sale would be distributed to shareholders.

“The board of AurionGold will meet in October to consider the timing of this distribution, in light of the progress made on the sale of other non-core assets by the company,” according to a company release.

AurionGold is trying to fend off a hostile takeover bid from Placer Dome (PDG-T). The world’s seventh largest gold producer is offering 17.5 of its shares for every 100 shares of AurionGold, plus A$0.35 per share in cash.

The takeover, if successful, would give Placer full ownership of the rich Granny Smith gold mine in Western Australia and increase its stake in the Porgera mine in Papua New Guinea to 75% from 50%. As a result, Placer would move into the number-five slot of global gold producers, with annual production of 3.8 million oz. Placer predicts that the proposed merger would produce savings of US$25 million per year and decrease the cash cost of producing an ounce of gold to an US$175.