The Competition Authority of Kenya (CAK) has approved the cash acquisition of Shanta Gold Ltd. by Saturn Resources Limited, a Dubai-based organization’s subsidiary.
Saturn Resources a newly incorporated company in Kenya that deals in gold exploration, acquired 100% of Shanta Gold Ltd’s shares. It holds mining licences in the western Kenya region.
Saturn’s parent company, ETC Group, is a Dubai-headquartered investment company with assets across logistics, agrochemicals, insurance, fertilisers, and distribution of fast-moving consumer goods.
CAK determined the acquisition wouldn’t negatively impact competition within Kenya.
“Post-merger, the market structure and concentration of the market for gold prospecting in western Kenya will not be negatively affected since the acquirer is not in a similar market,” CAK said. “Therefore, the transaction is unlikely to lead to a substantial lessening of competition in the market for gold exploration or prospecting.”
The transaction qualifies as a legal merger under Sections 2 and 41 of the Competition Act.
The Dubai company cited a decline in gold mining company stock market valuations as a reason for the acquisition.
The acquired company’s shareholders and directors approved the all-cash offer. Shareholders gained an exit opportunity with a cash payout reflecting current gold prices and business risks.
The company added, “It provides an exit opportunity in cash for all shareholders, taking into account the current gold prices as well as the operation and other risks inherent in the business.”
The West Kenya Project is made up of two greenfield deposits, the Isulu and Bushiangala. The project was acquired from Barrick Gold in February 2022 for $14.5m in cash and shares.
The West Kenya Project is located in western Kenya, in the county of Kakamega. It lies within the Liranda Corridor.
