Northern Star to buy 50 per cent stake in Kalgoorlie Super Pit

Gold miner Northern Star Resources has entered into an agreement with the Australian unit of Newmont Gold Corp to buy a 50 per cent stake in Kalgoorlie Consolidated Gold Mines for $US800 million ($A1.17 billion).

KCGM is a joint venture between Newmont and Saracen Mineral Holdings and owns the Super Pit in Kalgoorlie, Western Australia, among other deposits. Super Pit is the biggest open pit gold mine in Australia.

The Super Pit gold mine in Kalgoorlie.
The Super Pit gold mine in Kalgoorlie. Credit:Carla Gottgens

Last month, Saracen became the joint venture partner after Barrick sold its 50 per cent share of KCGM.

Northern Star said it would fund the deal through $A480 million ($US325.73 million) in debt, $A765 million institutional placement and a share purchase plan targeting to raise up to $A50 million.


Shares in the firm had been placed in a halt on Monday at $9.65.

The Western Australia-based company said the acquisition would be accretive to its earnings per share in the first full financial year of ownership.

Gold miners have been on a deal-making spree to boost their waning reserves amid higher bullion prices.

On Monday, Canada’s Equinox Gold Corp said it would buy rival Leagold Mining Corp for $US578 million.

Early this year, Newmont announced a $US10-billion takeover of Goldcorp Inc, on the heels of Barrick Gold’s purchase of Randgold Resources.

In Australia, Evolution Mining Ltd bought a 19.9 per cent stake in smaller peer Tribune Resources Ltd.


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