Johannesburg - South Africa's Sibanye Gold said on Wednesday that it had agreed to acquire the West Rand operations of junior miner Gold One International for 150 million new shares.
Sibanye was created earlier this year when Gold Fields spun off the bulk of its South African assets and it had signaled it was looking to expand in South Africa, where the bullion industry has been in decline.
The addition of the underground and surface operations west of Johannesburg will add about 260,000 ounces of gold a year to Sibanye's production over the next five years, it said.
The company has previously targeted production of about 1.3 million ounces a year.
Sibanye did not give a price for the deal, but said the new shares would represent 17 percent of its issued share capital.
The proposed transaction is subject to certain conditions, including approval from shareholders and South Africa's mines ministry, Sibanye said.
Neal Froneman, Sibanye's chief executive, formerly ran Gold One where he oversaw its acquisition by a Chinese consortium that included Baiyin Non-Ferrous Group, a subsidiary of the CITIC Group, China's biggest state-owned investment company, and the China-Africa Development Fund.
He told Reuters in February Sibanye would also seek to woo Chinese investors, who have not made many direct forays into African gold production. -Reuters