Gold Fields' ( NYSE: GFI ) proposed $6.7B takeover of Yamana Gold ( NYSE: AUY ) " doesn't make fundamental sense ," according to Joe Foster, who manages active gold funds at the VanEck investment firm, which is Yamana's biggest shareholder.
Gold Fields ( GFI ) has argued the deal would provide long-term growth and deliver cost savings, but Foster told Reuters the merger would create a more complex company with little synergy, and both miners would do better on their own than as a combined group.
The deal must win approval of 66.67% of Yamana ( AUY ) shareholders and 75% of Gold Fields ( GFI ) shareholders at votes scheduled for November 21 and 22, respectively; Foster told Reuters the outcome is "up in the air."
Investor concerns that the deal was dilutive and overvalued Yamana ( AUY ) sent Gold Fields ( GFI ) shares plunging more than 20% on the day of the announcement .
For further details see:
Major investor comes out against Gold Fields takeover of Yamana