Allied Gold (TSX: AAUC; NYSE: AAUC) to be taken private in Zijin Gold’s C$5.5bn all-cash offer, marking one of Africa’s largest gold M&A deals

Allied Gold Corporation (TSX: AAUC; NYSE: AAUC) has entered into a definitive agreement to be acquired by Zijin Gold International Company Limited in an all-cash transaction valued at approximately C$5.5 billion. The deal will see Zijin Gold, a Hong Kong-listed global mining major, acquire all outstanding shares of Allied Gold at C$44 per share—a 27 percent premium to Allied’s 30-day volume-weighted average price on the TSX. If approved, the acquisition will result in Allied Gold’s delisting from both the Toronto Stock Exchange and the New York Stock Exchange by late April 2026.

Why is Zijin Gold acquiring Allied Gold—and why now?

Zijin Gold’s pursuit of Allied Gold signals a targeted expansion of its African footprint through what it sees as generational-grade assets. The Chinese gold major already holds operations across nine countries and, with a market capitalization nearing US$70 billion, is among the few capable of executing large-cap, strategic gold acquisitions without external financing.

The deal notably includes producing assets and advanced-stage developments in Côte d’Ivoire, Mali, and Ethiopia—jurisdictions where Allied Gold has achieved operational traction. Zijin’s management cited both the scale and longevity of Allied’s Sadiola and Kurmuk operations as core motivators for the acquisition, while also acknowledging the significant potential of the Côte d’Ivoire Complex.

For Zijin Gold, the timing aligns with its long-term capital allocation playbook: expanding production base in stable, mining-friendly jurisdictions, while diversifying away from regions under geopolitical scrutiny. The immediate use of existing cash reserves also implies a desire to close quickly and mitigate execution risk—a pattern consistent with Zijin’s past acquisition behavior.

How did Allied Gold arrive at this decision—and what was left on the table?

The transaction follows a multiyear strategic review by Allied Gold, launched in 2024, which weighed geopolitical and operational risks, potential partnerships, asset-level alliances, and full-scale corporate combinations. During this period, Allied evaluated joint ventures, bolt-on acquisitions, and standalone development paths, including efforts to scale up the Sadiola expansion and Kurmuk project.

Despite modest improvements in balance sheet strength and operational metrics, Allied Gold’s share price and trading multiples remained stagnant—underscoring the market’s undervaluation of its African portfolio. As interest from potential acquirers mounted throughout 2025, Allied moved toward a focused M&A process. Ultimately, the Board and its Special Committee, advised by Moelis and Scotiabank, concluded that Zijin’s all-cash bid represented the highest and most reliable route to shareholder value realization.

What strategic advantages does this deal confer to Zijin Gold’s African portfolio?

From a portfolio optimization perspective, the Allied Gold assets provide complementary fit and scale. The Sadiola mine, which has been viewed by analysts as undercapitalized, now stands to benefit from Zijin’s deeper technical bench and capital base. The Kurmuk project in Ethiopia, a prospective multi-decade asset, adds optionality in a region where Zijin has minimal exposure, offering both diversification and first-mover advantage.

The acquisition may also support Zijin’s long-term goal of balancing its copper and gold revenue contributions, which have leaned heavily toward copper amid recent Latin American expansions. By consolidating high-grade, long-life African gold assets, Zijin insulates its portfolio from price volatility and broadens its geopolitical exposure—particularly valuable in an era of increasing U.S.-China resource tensions.

What are the terms, conditions, and risks involved in the acquisition timeline?

The transaction is structured as a statutory plan of arrangement under Ontario corporate law. It includes a non-solicitation clause, a fiduciary out, and a termination fee of C$220 million payable by Allied Gold if a superior bid materializes. As of January 26, directors and officers holding 15.4 percent of shares have entered into voting support agreements.

Regulatory approvals required include those under the Investment Canada Act, Canadian courts, and antitrust and foreign investment clearance in multiple jurisdictions, including the People’s Republic of China. Notably, the deal is not subject to Zijin Gold shareholder approval, removing a common procedural hurdle and potentially accelerating closure.

However, completion still hinges on a two-thirds approval from Allied shareholders and broader market stability. Currency volatility, gold price swings, and country-specific risks, especially in Ethiopia, could influence investor perception ahead of the vote.

Could rival bidders emerge before the shareholder vote?

While no alternative proposals have been publicly disclosed, the presence of a fiduciary out provision and competitive strategic value of Allied’s assets may leave the door open for counterbids. However, the high premium, firm all-cash consideration, and Zijin’s proven credibility in cross-border mining acquisitions present a formidable benchmark.

Given the Board’s unanimous support, and fairness opinions from Scotiabank affirming the transaction value, a rival offer would need to be materially superior in both price and certainty. Moreover, any delay in shareholder approval could complicate regulatory timelines and market expectations, especially amid tightening monetary conditions.

How will this acquisition reshape the competitive landscape in African gold?

If completed, this deal could mark one of the largest Africa-focused gold transactions in recent years. It repositions Zijin as a dominant mid-tier consolidator on the continent, further distancing it from gold mining peers with more cautious expansion strategies.

For Allied Gold’s former peers—mid-sized gold miners with Africa-heavy portfolios such as Endeavour Mining, Centamin, or Perseus Mining—the transaction reinforces the theme of strategic takeouts where asset quality exceeds market valuation. It also intensifies pressure on those lagging in capital efficiency, resource growth, or jurisdictional diversification to consider either consolidation or portfolio restructuring.

Meanwhile, it may complicate the calculus for other foreign entrants evaluating Africa, particularly as large-scale players like Zijin cement first-mover positions in underutilized mining jurisdictions.

What happens if the Allied Gold–Zijin deal fails to close?

In the event of regulatory pushback, shareholder rejection, or macroeconomic disruption, Allied Gold could find itself in a structurally weakened position. The public acknowledgment of the review process and the revealed premium offer effectively reset shareholder expectations. Without a deal, Allied would need to accelerate its organic value creation through production growth, cost optimization, or alternative partnership models.

A failed transaction could also invite activist scrutiny or discount reversion, especially if perceived execution gaps in Sadiola or Kurmuk remain unresolved.

What does the Zijin–Allied Gold deal mean for investors, competitors, and African gold consolidation?

• Zijin Gold will acquire Allied Gold for C$5.5 billion in cash, representing a 27% premium and full equity valuation at C$44 per share.
• The deal enhances Zijin Gold’s presence in Africa with long-life assets in Mali, Ethiopia, and Côte d’Ivoire.
• Allied Gold shareholders gain immediate value amid trading multiples that previously underpriced its asset base.
• The acquisition aligns with Zijin’s long-term strategy to diversify gold production and reduce dependence on copper assets.
• A competitive bidding process preceded the deal, but no rival offers have surfaced since the definitive agreement.
• The transaction includes strong protections: a non-solicit clause, fiduciary out, and a C$220 million break fee.
• Delisting from TSX and NYSE is expected post-close, signaling Allied’s transition into a privately held entity within Zijin.
• Regulatory approvals remain a key hurdle, especially across Canadian, Chinese, and African jurisdictions.
• Competitors may reassess their Africa strategies in response to Zijin’s aggressive, capital-backed expansion.
• Failure to close could reset shareholder expectations for Allied Gold and trigger scrutiny of standalone viability.