Shares of Vancouver-based gold miner Northgate Minerals Corp. rocketed 24.94 percent Monday after investors learned it will be bought by AuRico Gold Inc. for $1.48 billion.

If the deal goes through, the gold resources of AuRico, which has three properties in Mexico, will rise from 10.3 million gold equivalent ounces to almost 19 million and give it operating mines in Canada and Australia.

AuRico's offer of 0.365 shares per Northgate share, values each Northgate share at C$5.01 -- a premium of about 62 percent to Northgate's Friday close of C$3.10 on the Toronto Stock Exchange.

In the last 52 weeks shares of Northgate Minerals have ranged from $3.94 to $4.42. Shares climbed to $4.04 in after-hours trading.

The new company will have five operating gold mines, a sixth mine targeting production in 2012 and three gold development projects in Mexico, Canada, and Australia, three of the top global mining jurisdictions.

Under the terms of the Agreement, AuRico will acquire all of the issued and outstanding common shares of Northgate on the basis of 0.365 AuRico common shares per Northgate common share. Based on both companies' 20-day volume weighted average prices on the Toronto Stock Exchange ending on Aug. 26, 2011, the exchange ratio under the offer represents a 45 percent premium to Northgate's shareholders.

The combination of AuRico and Northgate will immediately position the combined company as a pre-eminent intermediate gold producer with peer leading growth, said Rene Marion, CEO of AuRico. The assets, projects and people in our two companies are highly complementary and we are excited about the many opportunities ahead for us to continue to deliver value to our shareholders.

Gold Australia Mexico Australia