Australia-based gold producer Lihir Gold Ltd. said it has rejected an $8.5 billion cash-and-stock takeover bid from Newcrest Mining as inadequate.

In a statement Wednesday after the markets closed, Lihir Gold said that on March 29 Newcrest offered one Newcrest share for every 9 Lihir Gold shares, plus 22.5 Australian cents (US20.7 cents) per LGL share.

Lihir Gold said that based on Newcrest's March 31 closing price, the offer was valued at 3.87 Australian dollars ($3.55) per share and valued the company at $9.2 billion Australian dollars ($8.5 billion).

Lihir Gold has mining operations in Papua New Guinea, Australia and West Africa and reached an output of 1.124 million ounces in 2009.

Shares of Lihir jumped $8.09, or 28.7 percent, to $36.34 in morning trading. Earlier, shares touched a new high of $36.76.