Canadian mining giant Endeavour has walked away from a potential bid for FTSE 250 gold miner Centamin (CEY).

In a statement, Endeavour boss Sebastien de Montessus said the quality of information received from Centamin during the due diligence process was ‘insufficient’ to allow it to be confident to go ahead with an offer.

Shares in Centamin dropped 4.1% to 122p following the statement this morning.

Canada-based Endeavour had proposed to merge with Centamin, offering 0.0846 Endeavour shares for every Centamin share, implying a value of 118p per Centamin share.


In its own statement Centamin said, ‘After a period of constructive engagement, Centamin and Endeavour have not reached agreement on value and have therefore terminated discussions.’

It added, ‘Notwithstanding the committed engagement from both sides, the board has unanimously concluded that the possible offer materially undervalued Centamin and its prospects.’


Analysts had called for the two parties to work more closely together to attempt to get a deal on the table, with Berenberg saying that a merger ‘makes sense operationally and strategically’.

Centamin runs the giant Sukari gold deposit in Egypt, while Endeavour operates a series of gold mines in West Africa.


Despite the possible strategic rationale of a merger, the prospects of an agreement have been dogged from the start. Endeavour went public with its offer after accusing Centamin of rejecting several previous attempts to engage in talks over a deal.

Then came accusations from Centamin that Endeavour was stalling on talks, before today’s announcement that the two parties have finally given up on merger discussions.

Commenting at the time of Endeavour’s initial proposal, AJ Bell investment director Russ Mould said Endeavour’s decision to go public is a ‘classic manoeuvre’ when a company tries to buy a business but they don’t want to talk.

He added that Centamin is an ‘obvious takeover target’ as its massive Sukari mine is considered a ‘prized asset’, but that the key sticking point on any deal would’ve been the price, with Centamin likely taking the view its recent share price isn’t indicative of the true value of the company when taking a long-term view.

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Issue Date: 14 Jan 2020