Saracen sells Red 5 stake for $39m

Saracen Mineral Holdings has sold its 10.5 per cent interest in Red 5 for $39 million, completed through a book build process at 30 cents per share prior to the ASX market open today.

Saracen acquired the shareholding in 2017 when Red 5 purchased the King of the Hills gold mine from Saracen for an upfront payment of $7 million cash and 90 million Red 5 shares, issued at 5 cents per share.

Saracen also received a deferred cash payment of $4.5 million.

The company acquired a further 40.6 million Red 5 shares at 5 cents per share for around $2 million during Red 5’s rights issue in August 2017.

The deal took Saracen’s holding in the company to 130.6 million shares – all of which Saracen has now sold.

Saracen managing director Raleigh Finlayson said the proceeds of the sale would be used to pay off debt associated with the company’s recent acquisition of a 50 per cent stake in the Kalgoorlie Super Pit.

Northern Star Resources holds the remaining 50 per cent share in the gold mine.

Saracen’s share price closed 1.52 per cent higher today to trade at $4.92 per share.