Shandong Gold Mining Co, one of China’s biggest gold producers, says it will buy Ghana-focused miner Cardinal Resources Ltd for about $A321 million in cash.

The deal continues a recent M&A flurry by Chinese gold firms after spot prices for the precious metal hit their highest in more than seven and a half years at $US1,764.55 an ounce last month, propelled by recession fears and China-US tensions amid the coronavirus outbreak.

Shandong Gold, which in April agreed to splash out $C230 million ($A248 million) on Canada’s TMAC Resources, said in a filing to the Shanghai Stock Exchange it had signed an agreement with Australia-listed Cardinal to pay 60 Australian cents per share and would acquire all the target’s equity for $A309 million.

The Chinese miner will also subscribe for 26 million new shares to be issued by Cardinal at a price of 46 Australian cents per share for a total $A12 million.

Cardinal did not immediately respond to a request for comment outside of normal business hours.

Its website says it is focused on the Namdini gold deposit in Ghana, which has 5.1 million ounces of proved and probable ore reserves, and has other exploration projects in the west African country.

Cardinal’s shares closed down 3.1 per cent at 47 Australian cents on Thursday.

Shandong Gold, whose shareholder Barrick Gold Corp this week said it had sold off most of its 17.9 per cent stake in the company, noted the Cardinal deal was subject to regulatory approvals, including from the Australian Foreign Investment Review Board.

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