Northern Star is backing its capacity to replicate the success of its Australian operations and silence any doubters, after taking a first big step offshore with the $US260 million ($356 million) acquisition of a gold mine in Alaska.
The Bill Beament-led Northern Star will become the new owner of the Pogo underground gold mine under a deal with Japanese multinational Sumitomo, and it was quick to compare the acquisition to that of its flagship Jundee mine in Western Australia in 2014.
The deal comes at a time when many Australian gold miners are looking to North America for acquisitions, in an attempt to take advantage of the higher relative valuations that Australian gold stocks have enjoyed compared with North American peers.
The acquisition will be funded from Northern Star’s cash reserves, which stood at $433 million at the end of 2017-18, and a fully underwritten $175 million placement to institutional investors handled by Macquarie.
Northern Star’s largest shareholder and long-time backer, BlackRock, has made a $57 million commitment to the tin rattling. ogo produced 271,273 ounces at an all-in sustaining cost (AISC) of $US882 an ounce in calendar 2017, making it the eighth largest gold mine in the United States.