Sunday, August 4, 2024, at the Fimiston open-pit gold mine, known as the Super Pit, operated by Kalgoorlie Consolidated Gold Mines Ltd. (KCGM) in Kalgoorlie-Boulder, Western Australia, Australia. Photographer: Carla Gottgens/Bloomberg via Getty Images
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Northern Star Resources Shares rose more than 9% on Monday after the Australian gold miner rejected a $27 billion takeover offer from South Africa’s Gold Fields.
Gold Fields offered to acquire 100% of Northern Star in a combination of stock and cash, offering 0.3125 Gold Fields shares and A$7.25 in cash for each Northern Star share, according to a statement from Northern Star on Monday.
Northern Star Resources stock.
The proposal, which was accepted on September 14, originally valued Northern Star at A$38.7 billion ($27.15 billion), a 22% premium over the September 11 closing price. Based on Gold Fields’ closing share price on Friday 25 September, the implied value has fallen to A$36.1 billion.
Northern Star said its board had unanimously rejected the proposal, adding that it “significantly undervalued” the company and was “highly opportunistic”.
“Gold Fields has sought to acquire one of the world’s leading gold portfolios at a highly opportune time, at a price well below what the board considers its fundamental value,” Northern Star Chairman Michael Cheney said.
Miners also raised concerns that the majority of the offer would be paid for in Gold Fields shares and that the offer would be subject to several conditions.
Northern Star told Gold Fields on Friday that its board did not consider it appropriate to engage further on the proposal.
Bloomberg previously reported that Gold Fields approached Northern Star about a possible acquisition.
