Northern Star Resources has achieved its goal of a takeover of Echo Resources after acquiring almost 60 per cent of the junior company.
Three of Echo’s independent directors and managing director have left the board, with two Northern Star representatives appointed as the non-executive directors.
Northern Star is extending its offer for a further two weeks to October 28, and is urging the remaining Echo shareholders to accept this offer without delay.
The company reiterated the reasons for accepting its offer, stating that it is unconditional, its control signalling a low likelihood of a superior proposal and an exposure to the risk of a share price fall upon the offer’s conclusion.
Northern Star is offering a 50 per cent premium on Echo’s 20-day volume weighted average price (VWAP), amounting to 33 cents for each remaining share Northern Star doesn’t own.
Echo has a key asset known as the Yandal gold project, which comprises over 1600 square kilometres of continuous tenements in the Yandal greenstone belt in Western Australia.
The belt hosts Northern Star’s Jundee project, and with the acquisition Northern Star could consolidate this mineralisation and carry out further exploration and development.
The Yandal project has existing mineral resources of 1.7 million ounces and ore reserves of 815,000 ounces.
Northern Star is seeking to determine the long-term management arrangements for Echo.