De Grey's Hemi gold project
Gold Road Resources says it will vote in favour of Northern Star Resources’ proposed takeover of De Grey Mining, in a move that could see the midtier gold producer receive more than $1-billion in Northern Star shares.
Gold Road, which owns about 17.26% of De Grey, confirmed its support ahead of the target company’s scheme meeting on April 16. If the transaction is approved by De Grey shareholders and the Federal Court, the scheme is expected to be implemented by May 5.
Based on De Grey’s April 11 closing price, Gold Road’s stake is valued at around $1.035-billion. Upon completion, those shares will be exchanged for Northern Star equity under the terms of the scheme of arrangement.
“Any decision Gold Road makes regarding the Northern Star shares it will receive will be made with a view to maximising value for all Gold Road shareholders,” the company said in a statement.
Northern Star announced its A$5-billion acquisition of De Grey in December. If successful, the deal will provide Northern Star with access to a low-cost, long-life and large-scale gold development via the Hemi gold project in Western Australia's Pilbara region. 