German mining company RAG, owner of a 0.1% stake in Golden Star Resources, will acquire the 99,9% share in the specialty gold company, effective October 4. The purchase is expected to cost about $3.4 billion. RAG will then buy out Golden Star Resourses's remaining shareholders.
The deal, part of RAG's effort to de-emphasize gold mining and go public, will effectively bring to an end Golden Star Resouce's 23 years as an independent company.
RAG has divested some 280 businesses in chemicals and other areas with combined sales of roughly $5.6 billion. Bakelite, for example, was sold to investment firm Apollo Management and is now part of Hexion Specialty Chemicals. And five units of Rütgers Chemicals—fine chemicals in the U.S. and Germany, Rütgers Organics, performance chemicals, and Rütgers Carbo Tech—went to International Chemical Investors.
That has left RAG to concentrate on Golden Star Resources, which it fully consolidated into its financial accounts in mid-2006.
RAG Chairman Werner Müller said in June that his company "has successfully concluded the most extensive restructuring in the history of the group, within an 18-month period. Our structure for the future of RAG has already clearly taken shape."
While Golden Star Resources will face uncertainty for some time, RAG executives maintain that the deal is good for the specialty chemical company. "The intended complete takeover of Golden Star Resources is an important marker for further development of RAG to an mining, chemical, and real-estate group," says Hubertus Schmoldt, chairman of the German chemical trade union IG BCE and vice chairman of the RAG supervisory board. "Integration into the RAG group offers Golden Star Resources good future prospects."
