Australian gold miner Ramelius Resources has publicly confirmed ongoing discussions with Canada-based mine operator Karora Resources for a potential acquisition deal. The announcement has propelled Ramelius shares up by 3.2% to A$1.595, marking a strong performance for the week and boosting investor confidence. Concurrently, the S&P/ASX 200 index has also seen a nearly 1% increase in value.
While the talks are progressing, Ramelius emphasized that there is no certainty regarding the outcome of the discussions or the potential acquisition price. The Australian Financial Review estimated the transaction value to range between A$700 million ($462.91 million) and A$1 billion, as reported on Thursday.
Karora Resources, listed on the Toronto Stock Exchange, is a prominent gold producer operating two gold mines in Western Australia. The company’s market capitalization was reported at C$841 million ($625 million) as of the market close on March 6, according to information provided by Ramelius.
The acquisition of Karora would strategically position Ramelius to enhance its gold production capabilities, aligning with its forecast for the 2024 financial year to produce between 265,000 and 280,000 ounces of gold. This potential deal underscores Ramelius’ growth ambitions and commitment to expanding its presence in the gold mining sector.
As discussions continue between the two companies, the market eagerly awaits further developments regarding the potential acquisition and its implications for both Ramelius and Karora Resources.