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Northern Star, Saracen in $16b merger

Steven Deare
·1-min read

Miners Northern Star and Saracen Mineral have unveiled a $16 billion merger plan they say would create a gold giant among the top ten in the world.

The boards of the Western Australian companies on Tuesday unanimously recommended what they called a merger of equals to shareholders.

The merged company would be called Northern Star Resources and have annual production of 1.6 million ounces. It would aim to raise that to 2.0 million ounces by the 2027 fiscal year.

Gold would come from three production centres at Kalgoorlie and Yandal in Western Australia, and North America.

The two companies have been joint venture partners in the Kalgoorlie gold mines known as the Golden Mile.

Northern Star would acquire all shares in Saracen. Saracen shareholders would receive 0.3763 Northern Star shares for each Saracen one. Saracen would also pay a special, fully-franked dividend of 3.8 cents per Saracen share.

Northern Star shareholders would own 64 per cent of the merged company. Saracen shareholders would own 36 per cent.

Northern Star boss Bill Beament would remain executive chair. Saracen managing director Raleigh Finlayson would be managing director, while Northern Star Stuart Tonkin would be chief executive.

The board would have five directors from Northern Star, and four from Saracen.

The proposal must be approved by courts and shareholders.

Management aims to complete the acquisition by February.

At 1316 AEDT, shares in Northern Star were up by 8.68 per cent to $15.02.

Shares in Saracen were higher by 8.62 per cent to $5.67.