China’s Zijin Gold and Allied Gold Scrap $3.9 Billion Merger

Zijin Gold's $4 billion takeover of Allied Gold is currently facing significant regulatory delays in China. This acquisition, initially valued at C$5.5 billion (approximately $4 billion), aimed for Zijin to pay C$44 per share, representing a premium of about 27% to Allied Gold's 30-day volume-weighted average price on the TSX at the time of the announcement. Allied Gold's CEO, Peter Marrone, indicated that these delays jeopardized the deal, an sentiment echoed by reports from May 29, 2026, which further highlighted China's slow pace in approving the transaction.

Despite the initial expectation for the deal to close by late April 2026, the regulatory hurdles have necessitated an extension of the outside date for the transaction to July 29, 2026. Prior to these delays, the acquisition was seen as a strategic move by Zijin Gold to expand its global footprint amidst rising gold prices, which had improved miners' margins and cash flows. Allied Gold's Q1 2026 earnings, reported on May 15, showed an adjusted EPS of $0.39 per share and higher revenue and adjusted profit.

Analysts have mixed sentiments regarding Allied Gold, with a mean consensus of "HOLD" based on an average target price of $32.03. The last close price was $25.32, suggesting a potential upside of approximately 26.52% if the acquisition were to proceed successfully at the average target price. However, the current regulatory issues create considerable uncertainty for Allied Gold shareholders, despite the previously attractive all-cash offer that represented an all-time high for the company's share price.

Allied Gold has confirmed the normal course conduct of business at its operating mines in Mali, Cote d'Ivoire, and its development project in Ethiopia, even as it continues to provide updates on the ongoing approvals process for the Zijin Gold transaction. The original agreement highlighted Zijin's reputation for successful international transactions and operational excellence, making the current delays a significant concern for both companies and the wider market.