From Excess To Discipline To Scarcity: What Allied Gold's 27% Premium Tells Us About The Next Phase Of Gold M&A

After a decade defined first by excess and then by discipline, gold M&A is entering a more selective phase. The premium paid in the Zijin–Allied transaction offers a measured signal of how scarcity, rather than exuberance, is reshaping deal-making in the sector.

Gold M&A has never been short of conviction. What has changed over time is where that conviction sits: first in growth, then in discipline, and now increasingly in scarcity. The re-emergence of acquisition premiums in recent transactions has prompted questions about whether the industry is reverting to old habits, or whether something more structural is at work.

The answer lies not in any single deal, but in how the gold sector has evolved over the past decade.

The pre-2018 years: confidence, excess and the limits of growth

In the years leading up to 2018, the gold industry was defined by confidence in scale. Growth in ounces was rewarded, executive pay rose sharply, and acquisition premiums of 30–40 per cent or more were widely accepted as the price of securing future optionality. Deals were justified on strategic positioning, pipeline depth and anticipated synergies, often with limited scrutiny of whether those benefits would ultimately translate into returns.

By 2017–2018, that model was already coming under strain. Contemporary industry commentary highlighted a sector drifting towards excess: rising capital intensity, serial deal-making, generous executive remuneration and a growing disconnect between management ambition and shareholder outcomes. Gold companies were increasingly perceived as rewarding size rather than value.

What followed was a familiar reckoning. Promised synergies proved elusive, capital was written down and investor patience wore thin, even as executive pay remained elevated. By the end of the decade, the message from shareholders was unmistakable: the industry needed to change.

2019–2021: the discipline era and the rise of the "widget" miner

The response was swift and, in many respects, effective. From 2019 onwards, gold companies remade themselves as disciplined, professional operators. Founder-led narratives gave way to institutional management. ESG frameworks hardened. Boards focused relentlessly on margins, sustaining capital and free cash flow.

Gold companies, in effect, became widget makers: predictable, comparable and increasingly judged on margins and free cash flow rather than on growth ambition.

This period was marked by low or nil premiums, often explicitly so:

• Barrick Gold / Randgold Resources (2018) — merger of equals structured off volume weighted average price (VWAP) exchange ratios, deliberately avoiding any notion of control pricing.
• Newmont / Goldcorp (2019) — agreed at approximately a 17 per cent premium to VWAP, notable at the time for sitting at the upper end of market tolerance.
• Equinox Gold / Leagold Mining (2019) — no-premium share exchange, presented as rational consolidation rather than acquisition.
• Endeavour Mining / Teranga Gold (2020) — modest premium of around 5 per cent to close and 9 per cent to VWAP, carefully calibrated to investor expectations.
• Agnico Eagle / Kirkland Lake Gold (2021) — explicitly framed as a merger of equals, with an effective premium of around 1 per cent.

This discipline era worked. Balance sheets strengthened and shareholder returns grew. By any reasonable measure, the sector had corrected its earlier excesses.

But discipline had an unintended consequence: by the end of 2021, the cupboard was bare.

As the industry consolidated, high-quality independent assets quietly disappeared into major portfolios. Very few large, long-life gold assets remained outside the ownership of major producers. Centamin's Sukari mine stood out in that landscape as one of the last Tier-1 gold assets not already held by a major, and it attracted competitive interest.

From 2022: scarcity tests discipline

What has emerged since 2022 is not a return to the wild days of pre-2018, but something more nuanced: a selective willingness to pay where scarcity and quality justify it.

That shift became visible across a small number of highly targeted transactions:

• Newmont / Newcrest (2023) — agreed at a premium of 30.4 per cent, marking a clear departure from the low- or nil-premium transactions that characterised the discipline era and reflecting the limited availability of assets offering scale and portfolio relevance.
• Yamana Gold (2023) — acquired in a split transaction by Agnico Eagle Mines and Pan American Silver at an implied equity value of approximately US$4.8–5.0 billion, representing a premium of around23 per cent to Yamana's undisturbed share price. While structured as a break-up, the transaction further reduced the pool of independent mid-tier producers and reinforced the scarcity dynamic at the corporate level.
• Centamin (2024) — acquired by AngloGold Ashanti at a premium of approximately 36–37 per cent, widely understood as the price required to secure one of the last remaining large, long-life producing gold assets not already held by a major.
• Predictive Discovery (2025) — the contested process around the Bankan project illustrated how scarcity is now extending further down the development curve. An initial agreed transaction implying a premium of around 14 per cent was overtaken by a competing proposal at approximately 25 per cent to last close and around 35 per cent to short-term VWAP, before improved terms ultimately secured shareholder support. The sequence demonstrated that, in a scarcity-driven market, low-premium approaches are increasingly vulnerable to being outbid where scale and perceived quality are in play.

Taken together, these transactions show that the re-emergence of premiums has been neither broad nor indiscriminate. It has been concentrated around a narrow set of assets offering scale, longevity and strategic relevance in a constrained opportunity set.

What the Zijin–Allied deal implies for gold M&A in 2026

It is against this backdrop that the Zijin–Allied transaction takes on significance. Allied represents a mid-tier, multi-asset producer with long-life operations — precisely the type of platform that has become harder to find following years of consolidation.

The agreed premium of around 27 per cent to 30-day VWAP sits comfortably below the excesses of the pre-2018 period, yet meaningfully above what would have been acceptable during the height of the discipline era. Rather than signalling a broad loosening of approach, the transaction reinforces the pattern that has emerged since Newcrest and Centamin: selective deal-making focused on scale, longevity and portfolio relevance, where scarcity justifies paying up.

Whether this marks the beginning of a more active phase of consolidation remains to be seen. What is clearer is that the market has moved beyond a simple aversion to premiums.

Not a return to excess, but a recalibration

The gold sector has moved through three distinct phases over the past decade: excess, discipline and now scarcity. The re-emergence of premiums does not signal that the lessons of the past have been forgotten. It reflects the fact that those lessons have been absorbed — and that the problem the industry now faces is different.

Gold companies have become more responsible, more professional and more focused on shareholder returns. They have also, almost inadvertently, created a scarcity of truly scalable, high-quality assets.

In that environment, premiums are no longer taboo. They are conditional.

The next phase of gold M&A will be defined not by a blanket return to paying up, but by how selectively the market is prepared to do so, and whether discipline can coexist with the realities of scarcity.

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