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- Northern Star Agrees $5b De Grey Takeover
Northern Star Agrees $5b De Grey Takeover
Spartan lifts its resource with Pepper notching up the grade
The Pre-Start
Northern Star will acquire De Grey for A$5 billion equity value in an all-scrip deal that will see shareholders get 0.119 NST shares per DEG share (NST) see more below
Spartan updated the Dalgaranga MRE, which now sits at 2.86Moz @ 5.6g/t, with Pepper contributing 873koz @ 10.3g/t (88% indicated) (SPR)
Catalyst shared drilling results from Plutonic East as it aims to de-risk near term mining, with the mine plan currently being redeveloped (4)
Santana Minerals shared drilling results from work done to assess infrastructure locations, with 8 of 22 holes returning mineralisation (SMI)
Small-scale testwork performed by Aurum from its Boundiali gold project has returned initial positive results, indicating 95% recoveries (AUE)
Great Boulder released assays intercepting gold at shallow depths from Saltbush (GBR)
Australian Pacific Coal’s largest shareholder, Nick Paspaley’s Trepang, has prevented the ratification of placement shares and opposed 7.1A capacity (AQC)
Larvotto completed an antimony offtake with Wogen Resources, with a concurrent US$4m prepayment facility signed (LRV)
Genesis is now a major shareholder of Labyrinth Resources (GMD)
Greenstone sold its 14% stake in Metro Mining, with Mark Sawyer resigning as NED having been the nominee director since 2016 (MMI)
Indiana Resources has appointed Lindsay Owler as its new CEO (IDA)
WA1 appointed Lee Bowers as NED (WA1)
High Grade It
Northern Star has agreed to buy De Grey in a deal valued at about A$5b (Bloomberg, Australian)
WA EPA gives nod to Hope Downs 2, Brockman Syncline (MiningNews)
RDG MD Andrew Ellison came under fire over how the company could afford to start repayments on a $125m interest-free loan from its parent MinRes (AFR)
The South Australian gov’t is urgently seeking to have 2 mothballed diesel-powered electricity plants restarted amid escalating concerns (AFR)
Peru’s Congress voted late on Friday to extend for six months a controversial permit that allows informal mines to operate in the country (Bloomberg)
BHP is set to rely even more heavily on its iron ore operations to help pay for growth ambitions in so-called future-facing commodities (Australian)
Lithium Argentina is seeking to redomicile to Switzerland following a corporate review and a new agreement with investor Ganfeng (NM)
A small environmentalist political party in Norway succeeded on Sunday in blocking plans to mine the sea bed at the bottom of the Arctic (Reuters)
Northern Minerals fended off a mystery director being elected weeks after Treasury flagged it could investigate new shareholders’ China links (AFR)
See for yourself with the free lithium dataset. Minerals Metrics do the leg work for you with clean, trustworthy workbooks
Wheelin’ n Dealin’
Northern Star agreed to acquire De Grey via a scheme of arrangement, in an all-scrip deal valuing DEG at $5b. Their offer comes at a 44% premium to DEG’s 30-day VWAP, while DEG shareholders will own ~20% of the combined group (NST)
No mention of Gold Road’s intentions at this stage (17.3% shareholder)
NST opened down 4%, DEG up 29% and GOR up 10%
The M&A call starts at 8:30am Perth time here
A$5B implies ~16% premium to consensus NAV, in our opinion a great outcome for DEG shareholders who get appropriate value and sit-out ramp-up risk
BHP’s need for copper prompts speculation of fresh Anglo bid (FT) Escondida facing reinvestment needs of up to US$10b over the next 7-years
The scheme booklet for Pilbara’s acquisition of Latin was registered with ASIC last week, read it here, first scheme meeting due to occur 16 Jan 25
Surprise surprise, FIRB has requested another extension to review Miracle Iron’s proposed acquisition of CZR’s Robe Mesa iron ore project (CZR) Given the ongoing FIRB delays the parties also agreed to end exclusivity obligations
The Supreme Court approved the Alto x Brightstar scheme (AME) Deal due to be implemented 9 Dec
Pantoro completed the sale of its Halls Creek project to Kimberley Minerals Group for $8m (PNR)
Rattlin’ the Tin
EQ Resources has revised its Mt Carbine expansion approach, discontinuing its $20m QIC loan, with the company looking at offtake arrangements (EQR)
Minbos received the first tranche of funds, totalling US$6.4m, from the Fundo Soberano of Angola (MNB)
Everest Metals has firm commitments for $4m @ 11c (EMC)
Word on the Decline
Here we were expecting Vault-Genesis to be the pre-Christmas gold mega deal but instead Northern Star and De Grey have the spotlight
Late last week we heard that deal discussions really are on ice for now between those two
But everyone expects a deal in the first quarter of 2025
Do you have some Word on the Decline? Reply to this email or shoot a message to [email protected] directly. We will always take your privacy seriously.
In the Weeds
The Rapaport Diamond Podcast with Eddie Levian (Rapaport) Watch from ~35 min mark for an interesting discussion on the synthetic market
Uranium & A Key Upcoming Catalyst (PauloMacro)
SmarterMarkets: Arjun Murti + Jeff Currie (Spotify, Apple)
BHP did Anglo a favour - regardless of whether they bid again (FT op-ed)
Rob McEwen (Currency Devaluation, Commodities, Beautiful Copper Mines, Pyramids) (YouTube)
Today’s Top Tweet
A punchy comment from Finchy.
The ball is in Northern Star’s court to execute here. We have to say congrats to De Grey too. Plenty thought if there was a deal to be done, it would have been done by now. You proved us wrong.
Devil’s in the Detail
It’s not every day that an undeveloped gold project sells for $5 billion…
A quick skim of the De Grey - Northern Star transaction docs and there’s a couple of things that stand out:
CTRL+F for “Gold Road” returns nothing
Break Fee $50 million but Reverse Break Fee $100 million - go figure!
The project finance package for Hemi was to include a ‘Royalty Standby Facility’ - assume that won’t be part of NST’s financing plan!
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