The Northern Star Resources Ltd (ASX: NST) share price is in the green on Monday morning.
Shares in the S&P/ASX 200 Index (ASX: XJO) gold miner closed Friday trading for $12.30. Shares are currently swapping hands for $12.40, up 0.8%.
The ASX 200 is down 0.4% at this same time.
This comes on the heels of a major acquisition announcement. Here are the highlights.
What new asset is the ASX 200 gold miner acquiring?
The Northern Star share price is climbing after the miner reported it has entered into a binding asset sale agreement with Strickland Metals Ltd (ASX: STK) to acquire Strickland’s Millrose Gold Project, located in Western Australia.
Northern Star will pay a total of approximately $61 million for Millrose. That’s comprised of $41 million in cash and 1.5 million Norther Star shares. Those shares will be issued to Strickland upon completion of the deal, subject to 12 months’ escrow.
The ASX 200 gold miner will also pay Strickland an immediate initial cash deposit of $2 million.
Millrose has a Mineral Resource of 346,000 ounces of gold at a grade of 1.80 grams per tonne. It’s situated just 40 kilometres from Northern Star’s Jundee Operations.
Commenting on the acquisition which is seeing the Northern Star share price gaining today, managing director Stuart Tonkin said:
The acquisition of the Millrose Gold Project presents a very compelling development opportunity that is accretive to the Jundee life of asset plan as it should deliver us a sizeable low cost, high grade supplementary resource feed.
This bolt-on acquisition, which also comes with significant brownfields exploration upside, will provide us with further confidence to plan organic and profitable growth for Jundee, which already is the lowest cost asset in our tier-1 portfolio.
Strickland CEO Andrew Bray noted Strickland bought the Millrose Project for $10 million in 2021.
“After a highly successful 11-month drilling campaign throughout 2022 costing approximately $16 million, we are now selling the project for approximately $61 million,” Bray said.
He noted the transaction will generate approximately $35 million in profit for Strickland.
The Strickland share price is up 18% on the news.
Completion of the deal is subject to limited standard conditions.
Northern Star share price snapshot
The Northern Star share price has been a stellar performer over the past 12 months, with shares up more than 76%.
