Nordgold interested in Cardinal’s Ghana project

(Image courtesy of Cardinal Resources).

Russian gold producer Nordgold announced that it has acquired a relevant interest in 98,443,593 shares in Cardinal Resources, which gives the company voting power of approximately 19.9% of the total share capital outstanding. 

In a press release, Nordgold said this acquisition includes an agreement to purchase 81,038,233 shares in Cardinal, or approximately 16% interest, held by Corporate International Holdings BV, a subsidiary of Gold Fields. 

A possible deal aims to bring the Namdini gold project into production

The miner also said that it has submitted a non-binding indicative and conditional proposal to acquire all the issued share capital of Cardinal that it doesn’t own already at A$0.45775 per Cardinal share. This preliminary proposal values the equity of Cardinal at approximately A$227 million on a 100% basis.

“At this stage, there is no formal proposal to acquire all the shares not already owned by Nordgold, nor is it certain that a formal proposal will be made,” the media brief states.

Nordgold explained that it would seek to formulate a binding preliminary proposal once Cardinal provides confirmatory due diligence access on certain key aspects of its Namdini project in Ghana. 

The project has been in need of financing since the first half of 2019. Thus, the alliance with Nordgold is aimed at bringing it into production. 

“Nordgold’s preliminary proposal would represent a substantial cash premium for Cardinal shareholders and provides an immediate opportunity to realise value without the associated risks of project development,” Nikolai Zelenski, Nordgold’s CEO, said in a media statement. “Nordgold is committed to operating in West Africa, and has the proven development experience and balance sheet to bring Namdini into production to the benefit of the local community and all stakeholders.”

Namdini is located approximately 50 kilometres south-east of the regional town of Bolgatanga, the capital of the Bolgatanga Municipal District and Upper East Region of northern Ghana.

The property lies within the Nangodi Greenstone Belt, one of a series of southwest–northeast-trending granite-greenstone belts which host significant gold mineralization in Ghana and Burkina Faso.

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