Chinese Regulator Delays Zijin Gold’s US$4 Billion Allied Gold Takeover

Beijing’s National Development and Reform Commission (NDRC) has delayed regulatory approval for Zijin Gold International's (HKEX:2259,OTCPL:ZJNGF) US$4 billion acquisition of Allied Gold (TSX:AAUC,NYSE:AAUC), questioning the transaction premium and the political risks of the target's mining operations in Mali.

According to a May 29 Financial Times report, the impasse has forced the companies to extend the outside completion date of the transaction by two months to the end of July.

While Canadian and African regulators have already approved the deal, clearance from the NDRC remains outstanding under China’s outbound investment review process. The NDRC has raised concerns over the premium Zijin is paying and the stability of Mali, which accounts for approximately half of Allied’s gold output.

In April, Mali experienced violent attacks by separatist and jihadist rebels that killed several senior government officials.

Additionally, Mali’s military government has arrested foreign mining executives over the past two years and renegotiated contracts with companies including major gold producer Barrick Mining (TSX:ABX,NYSE:B) and Resolute Mining (ASX:RSG,LSE:RSG,OTCPL:RMGGF).

Following news of the delay, Allied fell 6.5 percent to close at C$37.31 in Toronto, giving the company a market capitalization of C$4.4 billion. Its current share price sits significantly below Zijin’s offer price of C$44 per share, a 27 percent premium to Allied’s undisturbed 30 day average when the deal was struck in January.

The all-cash transaction was agreed upon during a surge in bullion prices — gold reached a record of close to US$5,600 per ounce just days after the announcement, then declined.

Allied operates producing gold mines in Mali and Côte d’Ivoire, generating nearly 380,000 ounces of gold in 2025. The company is also preparing to commission its Kurmuk project in Ethiopia later this year.

Allied has said its primary asset, the Sadiola mine in Mali, was not directly affected by the recent regional violence.

“There is strong industrial and commercial logic for this transaction, and both parties continue to work diligently towards closing,” the Financial Times quotes an Allied spokesperson as saying.

Zijin Gold, a subsidiary of Zijin Mining Group (HKEX:2899,SHA:601899,OTCPL:ZIJMF), intended the transaction to be its first major international acquisition following its initial public offering in Hong Kong last autumn.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.