IAMGOLD stock sees biggest jump in 4 years on rumors of Chinese bid
Shares of IAMGOLD Corp. (TSX: IMG) surged over 9% on Thursday — its biggest jump in four years — amid whispers of a possible bid from China. The nation’s second-biggest gold mining company, China National Gold Group Corp., is said to be considering a bid for a stake in IAMGOLD, according to BNN Bloomberg’s latest report.
So far the report only says the state-owned gold miner is in discussions with financial advisers regarding a potential offer. China National Gold has not responded to the bid rumors.
Just last month, IAMGOLD went public to address reports of a planned asset sale, stating there were no material changes in the company. However, the Toronto-based gold miner also did not openly deny it might be in talks with advisers and potential buyers.
China National Gold is the largest shareholder of Hong Kong-listed China Gold International Resources Corp. and Shanghai-traded Zhongjin Gold Corp.
IAMGOLD currently operates four mines — three in Africa and one in Canada — producing a total 882,000 ounces of gold last year.
The company’s most recent quarterly results fell short of analyst expectations, and earlier this year, it cut workforce at the Westwood mine by 32%. Reports of IAMGOLD exploring an asset sale followed shortly after its Q1 release.
A week prior, CEO Stephen Letwin said at the Mines & Money conference in New York that “we are going to see consolidation” and “there are too many mid-tier miners” — commenting on the sizable mergers that have materialized in the industry. Letwin added that IAMGOLD gets “a lot of interest” from Chinese investors.