BEIJING/TORONTO, Dec 2 (Reuters) – China’s Zijin Mining Group Co Ltd has agreed to buy Canadian miner Continental Gold Inc for C$1.3 billion ($1 billion), but a top executive with the target company said elevated security concerns in Colombia pose a risk to the deal.
State-backed Zijin’s offer for Continental, announced on Monday, aims to secure Continental Gold’s flagship Buritica gold project in Colombia. “Zijin doesn’t have any experience in Colombia, and we have obviously had some incidents in the past,” Continental Chief Financial Officer Paul Begin told Reuters.
“But if a major security incident happened at any project, it would be considered a material adverse change and they would have an out if they wanted to,” he said.
Four employees of Colombia-focused Continental were killed in a single month last year, one near Buritica and the others at a different exploration site.
Zijin’s cash offer of C$5.50 per share represents nearly a 13% premium to Continental’s Friday’s close. Continental’s shares were up nearly 10% in Monday afternoon trading in Toronto.
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