CDH pays $40m for 20% stake in China gold project

CDH will own a 21.05% interest in Sino Gold Tenya, Eldorado's Hong Kong subsidiary, which indirectly holds the company's 95% interest in Eastern Dragon, according to a statement. The transaction is expected to close within a month.

The gold mine is located in the northern Chinese province of Heilongjiang. Eldorado claims it has proven and probable gold reserves of 764,000 ounces. Production is estimated at 70,000 ounces of gold per annum with an expected mine life of 11 years.

The company said the investment will help complete the development of Eastern Dragon's full production, which is at an estimated cost of $45 million.

Listed on the Toronto and New York bourses, Eldorado's annual revenue totaled $1.12 billion in 2013, down from $1.15 billion the previous year. Adjusted net earnings were $192.9 million, down from $327.4 million in 2012, reflecting a 16% year-on-year decline in gold prices.

CDH, which manages assets across private equity, venture capital, real estate, listed equities and high-yield mezzanine, reached a final close of $2.55 billion on its fifth US dollar-denominated China fund two months ago.

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• Topics
• Greater China
• PIPEs
• Industrials
• China
• CDH Investments Management
• Commodities
• Growth capital
• PIPE