Golden Star Resources Ltd. has filed audited consolidated financial statements for the six months ended June 30, 2021, which are required by the Shanghai Stock Exchange in respect of Chifeng Jilong Gold Mining Co., Ltd. seeking to obtain the requisite approvals in connection with the company's previously announced plan of arrangement under Section 192 of the CanadaBusiness Corporations Act, involving the company, Chifeng and its subsidiary Chijin International (Hong Kong) Limited and/or an assignee of the Purchaser, pursuant to the arrangement agreement dated October 31, 2021.

A statement said the company previously filed unaudited interim consolidated financial statements for the three and six months ended June 30, 2021, on July 28, 2021, in accordance with and as required by applicable securities laws.

The audited H1 2021 financial statements were prepared in accordance with the full set of international financial reporting standards, as issued by the International Accounting Standards Board (IFRS) and the interpretations of the International Financial Reporting Interpretations Committee, which the Canadian Accounting Standards Board has approved for incorporation into Part 1 of the CPA Canada Handbook – Accounting, whereas, the Unaudited H1 2021 Financial Statements, although also prepared in accordance with IFRS, applied IAS 34 "Interim Financial Reporting" (IAS 34).

The audited H1 2021 Financial Statements are substantially consistent with the Unaudited H1 2021 Financial Statements and the only significant measurement difference arises from the income tax calculations prepared under IAS 12 "Income Taxes" for the Audited H1 2021 Financial Statements and under IAS 34 for the Unaudited H1 2021 Financial Statements. 

The effect is an increase in current tax expense of US$2.1 million with a corresponding increase in current income tax liabilities of US$2.1 million and a decrease in deferred tax expense of US$2.1 million with a corresponding decrease in deferred tax liability of US$2.1 million.

There is no impact on the consolidated statement of cash flows for the six months ended June 30, 2021.

“Readers must not place any reliance on the Audited H1 2021 Financial Statements as they have been prepared specifically for the purpose of the Transaction and not for the purpose of satisfying applicable securities laws requirements. Accordingly, readers must rely solely on the Unaudited H1 2021 Financial Statements which were prepared for the purpose of satisfying the Company's reporting requirements under applicable securities laws”, the statement added.

The Transaction

Pursuant to the Arrangement Agreement, Chifeng, through the Purchaser and/or its assignee, has agreed to acquire all of the issued and outstanding common shares of the company. Pursuant to and upon completion of the Transaction, shareholders of the Company will receive total consideration, payable in cash, of US$3.91 (equivalent to approximately C$4.85 as of October 31, 2021) per common share of the company (the "Consideration"), which equates to a total Transaction value of approximately US$470 million on a fully-diluted, in-the-money basis.

Advisors

Golden Star has engaged Canaccord Genuity Corp. as its exclusive financial advisor as well as Fasken Martineau DuMoulin LLP and Davis Graham & Stubbs LLP as its respective Canadian and United States legal advisors. Canaccord Genuity Corp. provided a fairness opinion to Golden Star's Board of Directors. Chifeng has engaged Stifel Nicolaus Canada Inc. and First Asia Group Ltd. as its financial advisors as well as Goodmans LLP as its legal advisor.

Golden Star Profile

Golden Star is an established gold mining company that owns and operates the Wassa underground mine in the Western Region of Ghana, West Africa. Listed on the NYSE American, the Toronto Stock Exchange and the Ghanaian Stock Exchange, Golden Star is focused on delivering strong margins and free cash flow from the Wassa mine.

As the winner of the Prospectors & Developers Association of Canada 2018 Environmental and Social Responsibility Award, Golden Star remains committed to leaving a positive and sustainable legacy in its areas of operation.

Chifeng Profile Chifeng is an international gold mining company listed on the Shanghai Stock Exchange with a market capitalisation of approximately US$4.3 billion.

It operates five mining assets, including the world-class Sepon gold mine in Laos.

In 2018, Chifeng acquired Sepon before undertaking significant capital expenditures to redevelop the gold processing facility in order to double its future gold production.