Northern Star Resources Limited and Saracen Mineral Holdings Limited are set to join forces, agreeing to a merger-of-equals worth $16 billion that will see the creation of a top-10 global producer.
Their combined world-class portfolio and three large-scale gold mines in Kalgoorlie and Yandal in Western Australia, as well as in North America, will target production of 2Mozpa. Kalgoorlie’s iconic Golden Mile will be consolidated under one owner for the first time in its 125-year history.
The merged company will benefit from the combined management teams with Bill Beament Chair, Raleigh Finlayson Managing Director, Stuart Tonkin Chief Executive Officer and Morgan Ball Chief Financial Officer. The new Board of nine will comprise five Directors from Northern Star, including Mr Beament, and four Directors from Saracen, including Mr Finlayson.
Mr Beament said this merger-of-equals will create an abundance of value for both Northern Star and Saracen shareholders.
“This is significant value-creating M&A. Our position as joint venture partners at KCGM, the close proximity of the majority of the combined company’s assets and a host of other synergies makes this a unique opportunity exclusive to Saracen and Northern Star shareholders.”
Mr Finlayson said the benefits which will flow to Saracen shareholders from this merger are significant.
“This is one of the most logical and strategic M&A transactions the mining industry has seen. The savings, the synergies and the growth opportunities it will generate make the transaction extremely compelling.
“In short, it is a unique opportunity for Saracen shareholders unlikely to be replicated via any other avenue.”
Each Saracen shareholder will receive 0.3763 Northern Star shares for each Saracen share held on the record date. Under the proposed deal, Northern Star shareholders will own 64% of the combined entity and Saracen shareholders will own the remaining 36%.