Australian gold producer Northern Star Resources has rejected calls from activist investor Elliott Management to explore asset divestments or a potential sale of the company, despite mounting pressure over its share price performance and operational execution, according to a report by Seeking Alpha.
Shares in the miner fell 3.5% in Australian trading following the disclosure, as investors weighed the board’s stance against Elliott’s campaign for strategic change.
Elliott, which has built a stake of roughly 3%–4% in Northern Star valued at more than A$1bn, has urged the company to consider selling non-core assets or initiating a broader strategic review that could ultimately lead to a takeover. The hedge fund outlined its position in a presentation titled “Northern Star Rising”, criticising the company’s capital allocation, operational performance and total shareholder returns.
In a letter to shareholders, Northern Star chairman Michael Chaney acknowledged that recent share price performance had fallen short of expectations. However, he said the board does not believe that initiating a sale process is appropriate at this stage.
Chaney added that while the company has previously received expressions of interest for mergers and acquisitions, those proposals were not considered to be in the best interests of shareholders at the time. He said the board remains open to reviewing strategic options periodically, but is currently focused on operating the business and improving performance.
The disagreement comes as Northern Star has faced a challenging period marked by repeated cuts to production guidance and operational setbacks, particularly at its Kalgoorlie processing facility, which have weighed on output and investor sentiment.
