Bolivar and Gold Fields win court approval

Scion Capital‘s battle against Gold Fields (GFI-N, GOF-L) acquisition of Bolivar Gold (BGC-T) may be over.

The Supreme Court of the Yukon approved Gold Fields acquisition of Bolivar, leaving Scion a minority shareholder in Bolivar with roughly 19% of its common shares — to ponder the tenability of its position.

California-based Scion’s chief legal officer Steve Druskin says the investment firm is evaluating its options.

“We’re not sure if we’re done yet or not,” Druskin says. “It will depend on the judges reasons.”

Druskin says the judge has not yet given his reasoning for allowing the deal to go through.

In court Scion argued the process leading up to Jan. 12 shareholder vote which voted in favour of the deal was unfair and oppressive to shareholders.

Scion released a dissident proxy in late December of last year which blasted the deal for being an undervalued offer; one that overplayed the political risk in Venezuela and didn’t reflect the upside of Bolivar’s Choco 10 mine in the South American country.

Choco 10 went into production in August of 2005. It processes 5,400 tonnes of ore per day from a reserve of 1.3 million oz. of gold. It is expected to produce 190,000 oz. of gold in 2006.

For Scion, the defeat in the Yukon was the second time in a month it came up empty in a courtroom. It’s case with the Ontario Superior Court where it argued shares held by Gold Fields should not have been counted in the Jan. 12 shareholders meeting didn’t hold up.

The judge said Gold Fields roughly 5.2 million voting shares would only be ruled on if they were material to the outcome of the vote. But with roughly 76.6% approval from all shareholders, (only two thirds approval was needed), the Gold Fields shares were not decisive.

South African-based Gold Fields offer is for US$360 million, and is part of its strategy to increase its foreign production output by 1.5 million oz. by 2009.