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Highlights
- $5B offer for De Grey Mining receives key investor support
- Gold Road Resources to back Northern Star’s proposal
- Deal marks record bid for an undeveloped gold project in Australia
Northern Star Resources (ASX:NST) is one step closer to finalising its landmark acquisition of De Grey Mining (ASX:DEG), after a significant endorsement from a major shareholder. Gold Road Resources (ASX:GOR), which holds a 17.3% stake in De Grey, has announced it will vote in favour of the $5 billion transaction.
The deal, unveiled last month, is notable for being the largest ever bid for an undeveloped gold project in Australia. De Grey’s Mallina Gold Project in Western Australia, considered one of the most promising new gold developments in the country, has been the key attraction behind Northern Star’s aggressive push.
An independent expert was engaged to evaluate the proposal and concluded that the offer was above De Grey’s assessed valuation range — a strong indication of the premium Northern Star is willing to pay to expand its portfolio. This has added weight to the significance of Gold Road’s support.
In an official statement, Gold Road confirmed its position: “Gold Road advises that it is supportive of the scheme and will vote all De Grey shares it holds or controls in favour of the scheme.” This backing could prove pivotal in swaying other investors, especially given the considerable shareholding Gold Road commands.
Should the transaction proceed as proposed, Gold Road’s current stake in De Grey would be converted into shares in Northern Star. This would effectively transition Gold Road into a shareholder of a significantly larger gold company with a broader production base and stronger market position.
The proposed acquisition represents a strategic leap for Northern Star, aiming to reinforce its presence in the Australian gold sector. With the inclusion of the Mallina Project, Northern Star would gain access to a world-class resource that could substantially boost its production outlook over the coming years.
As shareholders prepare to vote on the scheme, market participants will be closely watching how other key investors react to Gold Road’s endorsement. The outcome of this deal could set a precedent for future consolidation moves in the Australian resources sector.
