Northern Star's proposed buyout of De Grey will help optimise asset portfolio, analysts say

Gold Road Resources

02/12/2024 21:30

** Citi says Australian gold miner Northern Star's  NST.AX 
A$5 bln ($3.24 bln) deal to buy De Grey Mining  DEG.AX  "makes
sense" as it helps co mitigate its ageing, capex-intensive
portfolio
    ** Jefferies says the deal will allow NST to optimise its
asset portfolio with potential divestment of superfluous assets
    ** Citi, however, expects investors doubting if there is a
risk of a counter bidder
    ** Jefferies says if the deal was to become contested, then
Gold Road Resources'  GOR.AX  ~17% stake in DEG will deliver a
high degree of strategic flexibility to any counter-bidder
    ** Both brokerages believe DEG's Hemi gold deposit has a
significant exploration upside and will be value accretive to
NST
    ** Citi downgrades NST to "neutral" from "buy", noting 25%
share price increase since mid-CY; lowers PT to A$17.00 from
A$18.30 on EPS dilution
    ** Jefferies maintains NST's "buy" rating, A$19.50 PT
    ** As of last close, NST stock up 21.5% YTD
    

($1 = 1.5458 Australian dollars)



 (Reporting by Nichiket Sunil)
 ((Nichiket.Sunil@thomsonreuters.com))