Northern Star Resources Ltd (ASX: NST) and Saracen Mineral Holdings Ltd (ASX: SAR) are pleased to announce that they have entered into a binding Merger Implementation Deed (MID) under which the two companies will merge via a Saracen scheme of arrangement (Scheme).
The Scheme will create a Top-10 global major gold producer, with high-margin assets located exclusively in Tier-1 jurisdictions.
The merged Company will benefit from the combined skills and experience of the two leading management teams.
Under the Scheme, Northern Star Executive Chair Bill Beament will be Chair of the merged group (transitioning from Executive to Non-Executive Chair in July 2021) and Saracen Managing Director Raleigh Finlayson will be Managing Director.
Stuart Tonkin will be Chief Executive Officer and Morgan Ball will be Chief Financial Officer. Upon completion, the Board of nine will comprise five Directors from Northern Star (including Mr Beament) and four Directors from Saracen (including Mr Finlayson). Saracen's Non-Executive Chair Tony Kiernan will be the Lead Independent Non-Executive Director.
Under the terms of the Scheme, each Saracen shareholder will receive 0.3763 Northern Star shares for each Saracen share held on the record date. Upon implementation of the Scheme, Northern Star shareholders will own 64.0% of the combined entity and Saracen shareholders will own the remaining 36.0%.
The Saracen Board of Directors unanimously recommends that Saracen shareholders vote in favour of the Scheme and each Saracen Director intends to vote all the shares that they hold in Saracen in favour of the Scheme (in both cases, subject to the Independent Expert opining that the Scheme is in the best interests of Saracen shareholders and in the absence of a superior proposal). The Northern Star Board unanimously endorses and supports the transaction in the absence of a superior proposal for Northern Star.
Mr Beament said: 'Northern Star has only ever pursued growth when it will create value for shareholders, and this merger-of-equals will create an abundance of value for both Northern Star and Saracen shareholders.
'This is significant value-creating M&A. Our position as joint venture partners at KCGM, the close proximity of the majority of the combined company's assets and a host of other synergies makes this a unique opportunity exclusive to Saracen and Northern Star shareholders.'
Mr Finlayson said: 'The benefits which will flow to Saracen shareholders from this merger are significant. The pre-tax synergies alone are expected to be worth in the order of A$1.5 to A$2.0 billion over the next 10 years. Saracen shareholders will own 36.0% of the combined group and therefore share in the significant benefits of these synergies, which is value that would not have been available to our shareholders otherwise. It is difficult to foresee anything like that reduction in our cost base outside of this merger.
'This is one of the most logical and strategic M&A transactions the mining industry has seen. The savings, the synergies and the growth opportunities it will generate make the transaction extremely compelling. 'In short, it is a unique opportunity for Saracen shareholders unlikely to be replicated via any other avenue.'
Contact:
Kurt Walker
Tel: +61 8 6211 2620
Email: info@nsrltd.com
Forward Looking Statements
Northern Star Resources Limited and Saracen Mineral Holdings Limited have jointly prepared this announcement based on information available to them. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this announcement. To the maximum extent permitted by law, none of Northern Star Resources Limited or Saracen Mineral Holdings Limited, their directors, employees or agents, advisers, nor any other person accepts any liability, including, without limitation, any liability arising from fault or negligence on the part of any of them or any other person, for any loss arising from the use of this announcement or its contents or otherwise arising in connection with it. This announcement may contain forward looking statements that are subject to risk factors associated with gold exploration, mining and production businesses. It is believed that the expectations reflected in these statements are reasonable but they may be affected by a variety of variables and changes in underlying assumptions which could cause actual results or trends to differ materially, including but not limited to price fluctuations, actual demand, currency fluctuations, drilling and production results, reserve estimations, loss of market, industry competition, environmental risks, physical risks, legislative, fiscal and regulatory changes, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, approvals and cost estimates.
NORTHERN STAR RESOURCES LIMITED 
