Zijin's C$5.5B Allied Gold Takeover Collapses at Deadline

The C$5.5 billion takeover of Canadian gold producer Allied Gold by China's Zijin Gold International has collapsed after Chinese regulators failed to approve the deal before the July 29 deadline. In its place, Zijin will take a 9.2% stake through a US$295 million strategic investment.

Allied Gold shares fell nearly 18% in Toronto to C$24.27, valuing the company at just over C$3 billion, roughly C$2.5 billion below the original takeover price. In New York, the stock dropped 16% to US$17.68.

Contents

01

The Rise and Fall of a Blockbuster Deal

02

What Went Wrong

03

The Alternative: A Minority Stake

04

Where the Proceeds Go

The Rise and Fall of a Blockbuster Deal

Allied Gold and Zijin Gold signed a definitive arrangement agreement on January 26, 2026. Zijin, one of the world's largest gold miners with a market cap of US$70 billion, agreed to acquire all Allied Gold shares at C$44 per share. The offer carried a 27% premium over Allied Gold's 30-day volume-weighted average price on the TSX and valued the company at approximately C$5.5 billion.

The deal was expected to close by late April 2026, pending shareholder and court approval, Investment Canada Act clearance, and regulatory sign-off from China. A C$220 million termination fee was payable by Allied Gold in certain circumstances.

What Went Wrong

While Canada and other international jurisdictions approved the transaction, it remained stalled in China. According to MINING.com, Chinese regulators never gave the green light. Security and streaming arrangements, capital investments, and lending agreements also went unresolved.

Allied Gold said the termination “relates to broader external factors applicable to cross-border transactions of this scale.” Both sides agreed there was “no reasonable likelihood” closing conditions would be met within any reasonable period.

The Alternative: A Minority Stake

Zijin did not walk away empty-handed. Under a subscription agreement signed the same day, it will buy approximately 12.8 million newly issued Allied Gold shares at C$32.55 each, for total proceeds of roughly US$295 million. The price matches Allied Gold's 30-day VWAP on the TSX as of July 27 and represents a premium to the current market price.

Once completed, Zijin will hold approximately 9.2% of Allied Gold. The placement requires TSX and NYSE approval and is expected to close on or about August 10, 2026.

Where the Proceeds Go

Allied Gold will channel the funds into its African growth pipeline: completing and ramping up Kurmuk in Ethiopia, where operations begin in August 2026 with first gold weeks later, expanding Sadiola in Mali, boosting output at the Côte d'Ivoire Complex, and funding exploration. The company produces about 375,000 ounces of gold annually.

Allied Gold went public in 2023, with executive chairman Peter Marrone investing about US$50 million. Marrone founded Yamana Gold in 2003 and oversaw its US$4.8 billion sale in 2023. The failed takeover highlights the growing difficulty of large cross-border mining deals as geopolitical tensions and regulatory scrutiny weigh on Chinese-backed transactions.