It has been a sensational couple of sessions for the Dacian Gold Ltd (ASX: DCN) share price.
At the time of writing, the ASX gold stock is up 18% to 26.5 cents.
This means that its shares are now up over 100% week to date.
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Why is the ASX gold stock on fire this week?
Investors have been scrambling to buy this gold miner's shares this week after the company received and accepted a takeover approach from Genesis Minerals Ltd (ASX: GMD).
According to the release, the two parties have entered into a binding bid implementation deed (BID) under which Genesis Minerals will acquire the remaining shares it doesn't already own (~20%) in Dacian Gold by way of a recommended conditional off-market takeover offer.
The ASX gold stock's shareholders will receive 0.1685 new Genesis shares for every 1 Dacian share held, which implied a value of 23.5 cents per share at the time.
However, with the Genesis Minerals share price rising this week and now fetching $1.44, the offer equates to 24.3 cents per share.
So why are its shares trading above this?
That's because Genesis Minerals is so keen to get the deal over the line that it is offering 0.1935 Genesis shares per Dacian Gold share if it can acquire a relevant interest of not less than 95.1% during the offer period of approximately one month.
The offer of 0.1935 Genesis shares per Dacian share equates to 27.86 cents per share at current levels.
Why is Genesis wanting to acquire Dacian Gold?
The release notes that Genesis Minerals considers this a logical transaction to simplify the ownership of large-scale resources, reserves and milling infrastructure in the world-class Leonora District.
Genesis Managing Director, Raleigh Finlayson, said:
The acquisition of the remaining ~20% of Dacian is a logical step to simplify the ownership of an enviable position in the Leonora District – 15Moz of combined Resources, 3.9Moz of combined Reserves and 4.3Mtpa of combined milling capacity.
