Australia's Westgold to buy Karora Resources in $808 mln deal (updated)

Karora Resources

08/04/2024 01:21

(Adds details and context in paragraphs 2-6)
       April 8 (Reuters) - Australia's Westgold Resources
 WGX.AX  said on Monday it has agreed to acquire Toronto-listed
Karora Resources  KRR.TO  in a cash-and-stock deal worth about
A$1.23 billion ($808.36 million), seeking its gold assets in
Western Australia.
        Under the deal, Karora shareholders will receive 2.524
Westgold shares, with A$0.68 in cash and 0.30 of a share in a
new company to be spun off from Karora. 
        The deal implies an offer price of A$6.60 per Karora
share, or C$5.90 a share, based on Westgold's last closing price
and the Australian dollar to Canadian dollar exchange rate on
April 5, representing a 10.1% premium to Karora's closing share
price. 
        Karora Resources is focused on increasing gold
production at its Beta Hunt gold mine and Higginsville gold
operations in Western Australia and earlier ended buyout talks
with another Australian gold miner, Ramelius Resources  RMS.AX .
        "The prize here is Beta Hunt's gold potential. Rarely do
you find a gold asset of the quality and potential of Beta Hunt
hiding in a nickel belt and drilling is expected to further
unlock value at this mine," Westgold CEO Wayne Bramwell said.
    Upon completion of the deal, Westgold shareholders will own
50.1% of the combined company. 
        
  
     ($1 = 1.5216 Australian dollars)
    

 (Reporting by Sherin Sunny in Bengaluru; Editing by Sherry
Jacob-Phillips and Sonali Paul)
 ((Sherin.Sunny@thomsonreuters.com;))