ASX-listed gold miner Northern Star Resources Ltd has priced US$600 million worth of senior 10-year notes, paying 6.125 per cent a year paid semi-annually according to an ASX announcement today.
The notes due in April 2033 will be guaranteed by certain wholly-owned subsidiaries of Northern Star.
The company said it intends to use the proceeds from the notes for general corporate purposes including capital expenditures. Some of the proceeds could be used for its Kalgoorlie Consolidated Gold Mines (KCGM) expansion once it reaches its final investment decision.
Settlement of the notes is expected to occur in New York on 11 April 2023.
Northern Star has three investment grade credit ratings of Baa3 (stable), BBB- (stable), and BBB- (stable) by Moody’s, S&P, and Fitch respectively.
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According to the Australian Financial Review, early guidance was for 300 basis points above swaps and US$500 million deal size.
Northern Star Resources managing director Stuart Tonkin said, “We are pleased with the investment grade ratings assigned to Northern Star, which reflect the strength and resilience of the business and our disciplined approach to capital management. Our continued performance and strong financial position have enabled Norther Star to successfully access the US bond market for the first time.
“Proceeds from the notes will provide Northern Star with further depth and flexibility of funding as we increase profitable production to 2Moz per year by FY2026 and consider other organic growth opportunities including the mill optimisation at KCGM.”
Northern Star Resources has assets in Alaska and Western Australia, and is Australia’s second largest gold producer. It is chaired by Michael Chaney, who is also chairman of Wesfarmers Limited and a former managing director of that company. He was also previously chairman of Woodside Petroleum Limited.
