South African mining company Gold Fields Ltd. is sweetening its dividend policy and seeking a listing on the Toronto Stock Exchange as it tries to placate shareholders who have been skeptical of its planned US$6.7-billion takeover of Toronto-based Yamana Gold Inc.
The merger, which would create the world’s fourth-biggest gold producer, has been poorly received by many investors, with the share price of Gold Fields plummeting by 23 per cent on the New York Stock Exchange on May 31 when the deal was announced.
Since then, Gold Fields has been working hard to sell the deal with an online advertising and publicity campaign, including paid Twitter posts. On Monday it went a step further, announcing a higher dividend range and a planned TSX listing, as chief executive Chris Griffith predicted “superior shareholder returns” from the “winning combination of excellent assets.”
Under the new policy, Gold Fields says it will pay out 30 per cent to 45 per cent of its normalized earnings at the interim and final dividend stages, up significantly from the existing policy of 25 per cent to 35 per cent.