Northern Star Resources to Acquire De Grey Mining in A$5 Billion Deal
Northern Star Resources has agreed to acquire De Grey Mining in an all-stock transaction valued at approximately A$5 billion ($3.26 billion). This acquisition comes as gold prices hover near record highs, prompting gold companies to secure new mining assets in a competitive landscape.
The acquisition will give Northern Star one of the largest undeveloped gold projects globally, as De Grey estimates that its assets could become some of the highest-producing and lowest-cost gold mines in Australia. This aligns with Northern Star's strategic expansion goals.
Northern Star, which operates gold mining projects in Australia and the United States, has been aggressively increasing its production capacity. The acquisition is part of the company’s five-year plan initiated in mid-2021 to reach an annual gold production target of 2 million ounces by fiscal 2026, which would represent an increase of about 25%. With a current market capitalization of over A$20 billion, Northern Star is Australia's largest publicly listed gold miner.
Under the terms of the agreement announced on Monday, De Grey shareholders will receive 0.119 new Northern Star shares for each De Grey share they hold, implying an offer value of A$2.08 per share. This represents a 44% premium to the 30-day volume-weighted average price of De Grey shares, providing substantial value for existing shareholders.
