Gold Fields (JSE:GFI) has tabled an offer to buy Northern Star Resources (ASX:NST) in a potential blockbuster deal that would combine two of the world’s largest gold producers.
According to a Bloomberg report, Gold Fields recently approached Northern Star about a potential merger, but its initial proposal was turned down.
Northern Star later confirmed in a statement that it has received and rejected a “confidential, opportunistic” offer of $38.7 billion.
The offer gives the Australian miner an implied value of $27 per share, representing a 22% premium to the stock’s last closing price.
A potential deal for Northern Star would further expand Gold Fields’ presence in Australia, where it already operates four mines in Western Australia’s Goldfields region.
Gold Fields expands portfolio
Gold Fields has been pursuing acquisitions to strengthen its global portfolio in recent years.
Last year, the South African miner completed a $3.7 billion acquisition of Gold Road Resources, giving it full ownership of the Gruyere mine in Western Australia.
Before that, Gold Fields acquired Osisko Mining for C$2.16 billion ($2.17 billion), gaining ownership of one of Canada’s largest undeveloped gold deposits in Windfall.
The acquisitions expanded Gold Fields’ international portfolio at a time when some of its African operations were starting to weigh down its future outlook.
In South Africa, its South Deep mine has experienced weaker productivity. Meanwhile in Ghana, the company faces uncertainty over the future of its Tarkwa mining licence.
Northern Star faces pressure
The approach from Gold Fields also comes during a period of uncertainty for Northern Star.
The Subiaco-based miner, with two major production hubs in Western Australia, has faced operational challenges in recent years and repeatedly lowered its production guidance.
The company is also facing pressure from investor Elliott Investment Management to pursue a sale or divestment.
Earlier this year, Northern Star Chairman Michael Chaney told shareholders that the company had received approaches from several potential buyers but dispelled its intention to sell.
A combination with Gold Fields would bring together two of the world’s 10 largest (eight and tenth, respectively) gold producers based on their respective production during H1 2026.
Shares of both companies have fallen by about 9% so far this year.
Write to Jackson Chen at Mining.com.au
Image: Northern Star Resources
