By Crystal Tse, Dinesh Nair, Manuel Baigorri, Loni Prinsloo and Yihui Xie.
Australia’s biggest gold miner Northern Star Resources rejected a cash-and-shares takeover approach from South African rival Gold Fields valuing it at A$38.7 billion ($27.1 billion).
Northern Star has been under pressure from activist investor Elliott Investment Management, which has criticised the miner’s underperformance and called for it to consider a sale or asset divestments, along with a board overhaul. The miner appointed a new chief executive officer in July.
The offer didn’t “reflect the fundamental value” of Northern Star’s portfolio and growth options, and was “highly opportunistic,” coming ahead of the commissioning of a new project and the arrival of Suresh Vadnagra, a former Glencore and Newcrest Mining executive who takes the helm next month. The Australian miner informed its suitor that it will not engage further on the indicative offer, it said.
“We remain open to constructive dialogue and continue to seek engagement with the Northern Star board to discuss the merits of the proposed transaction,” Goldfields CEO Mike Fraser said in a statement.
A combination would create the world’s second-largest gold producer, with potential synergies of as much as $5 billion, according to the South African company.
Elliott believes “there’s immense potential for value creation” at the Australian miner, which any transaction would need to reflect, John Pike, a partner at the asset manager, said in an emailed statement. “But others clearly see the value here too, and we think the board has an obligation to engage with any serious buyer and fully evaluate the best path to deliver on that potential.”
A multiyear rally in gold prices has driven a wave of dealmaking in the industry, with Gold Fields among the most acquisitive. Meanwhile, Northern Star has cut its production guidance several times over the past year, with issues at its Kalgoorlie processing plant in Western Australia constraining production from what Elliot has called “world-class” mining assets.
Surging bullion prices have also heaped pressure on miners to maximise returns on their portfolios, with several producers considering spinoffs and asset sales after a series of cost blowouts and operational setbacks that plagued the sector in recent years.
“Gold Fields has sought to acquire one of the world’s premier gold portfolios at a price that falls well short of what the board considers to be its fundamental value and at a highly opportunistic time,” Northern Star Chairman Michael Chaney said in a statement. The bid, at an implied A$27 per share based on the Gold Fields closing price on September 11, amounted to a 22% premium, the company said.
Chaney added the equity component of the conditional offer — newly issued Gold Fields’ stock — carried “a meaningfully higher jurisdictional risk profile.”
Gold Fields said under the current proposal, Northern Star shareholders would own around a third of the South African miner upon the implementation of the deal and that it would seek a secondary listing in Sydney.
Shares in Northern Star jumped as much as 11% to A$24.46, closing in on the bid’s implied price. They closed at A$23.47.
Northern Star “likely wants to focus on trying to increase its market capitalisation” considering the strength of its assets and is “unlikely to be acquired at a low valuation,” said Lisa Liu, managing director at Gold Mountains Asset Management, an asset management arm of Zijin Mining Group.
© 2026 Bloomberg.