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NovaGold to buy Paulson’s 40% Donlin Gold stake in $4.2B deal
The all-share transaction would give NovaGold effective 100% ownership of Donlin and expand projected early production to 1.3 million ounces of gold annually.
NovaGold Resources is surging after agreeing to acquire Paulson Advisers’ entire 40% stake in Alaska’s Donlin Gold project in a deal valued at $4.2 billion, according to Yahoo Finance.
NovaGold said the transaction will be conducted through an all-share agreement, with Paulson and NovaGold forming a new company, NovaGold Corporation, that will hold the full stake in Donlin. Current NovaGold shareholders are set to receive shares in the new company on a 1:1 basis, while Paulson is expected to own 40% and become one of the project’s largest shareholders.
As part of the plan, the new NovaGold to list on the New York Stock Exchange, an upgrade from its current NYSE American listing. The company’s board will be co-chaired by Thomas Kaplan and John Paulson and expanded to 11 directors from 10, with Paulson having the right to nominate two directors as long as its ownership stays above 15%.
Yahoo Finance also cited NovaGold’s production outlook, including projected annual gold output of 1.3 million ounces in the first decade and 1.1 million ounces over the 27-year mine life, which NovaGold expects would make Donlin the largest US gold development project. John Paulson said consolidating his interest is meant to streamline and expedite development, describing Donlin as a world-class gold investment.
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