Genesis stump-up $450M for St Barbara

Yet another major gold is likely following Genesis Minerals’ $450 cornerstone courting of Western Australian gold mining royalty St Barbara amid prices for the precious yellow metal approaching a new all-time high.

Both companies remain in voluntary suspension as the finer workings deal are nutted out, with reworkings set to come 9.7 per cent higher than St Barbs’ 10-day volume weighted average price.

The deal comes after the gold miner posted a $407 million statutory loss for the half after massive write-downs of its overseas assets, posing challenges to the agreement regarding its net debt.

But experts never doubted the deal moving forward, sighting almost equal to the loss in efficiency savings delivered from the merged company’s combined assets.

Some commodity strategists see the price of gold thrashing the all-time high of US$2075, going as high as US$2600 an ounce.

The actions of the majors have backed up a heady future for the commodity, with US giant Newmont Mining having upped its offer for Newcrest by 16 per cent — making it a $29.4 billion acquisition for the Australian miner.

Now sitting over US$2047, the price of gold is less than 30 bucks off an all-timer, and miners have been rising in tune, the ASX All Ordinaries Gold shifting up by nearly a third in the year to date.

While headline-grabbing predictions may never come to pass, it seems gold has, at the very least, proven itself again as a premier long-term investment.

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