The board of Norton Gold Fields has advised its shareholders to accept the takeover bid of Zijin Mining Group, China's biggest gold producer.
"We see this as a great opportunity for Norton and for the Paddington operations (in Western Australia) to move forward," Andre Labuschange, managing director of Norton Gold Fields, told reporters on Friday.
"The board unanimously recommends to shareholders to accept the offer in the absence of a better offer," he added.
The Zijin Mining Group presently controls 17 per cent of Norton Gold Fields. It proposed to buy the remaining shares of the Australian miner at A$0.25 cash per share, plus a special dividend of A$0.02.
The Zijin Mining Group's offer, however, is calculated on the premise that spot gold prices will not fall below A$1,400 per ounce for three consecutive days in the next six months.
The spot price of the precious safe haven yellow metal gold currently trades at $US1,556.10 per ounce, or $A1,603.08 per ounce.
The announcement from the board of Norton Gold Fields, as well as its unanimous support, winds up speculations that started more than two months ago regarding the Zijin Mining Group's unsolicited bid approach.
The Zijin Mining Group acquired its 17 per cent hold in Norton Gold Fields in September 2011.
The Zijin Mining Group, should its bid become successful, would become the first Chinese group to get hold of a WA-focused gold miner.
Besides the usual increased cash flow, one of the major benefits expected of the takeover is the access to the Zijin Mining Group's technology.
"That would allow us and them to look at opportunities to get costs down, start new projects and see how we grow the production at Paddington," Mr Labuschange said.
Shares of Norton Gold Fields have been placed in a trading halt. It last traded at A$0.21 per share.
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