Miners Northern Star and Saracen Mineral have announced a $16 billion merger they say would create a gold giant among the top 10 in the world.
The boards of both companies on Tuesday unanimously recommended what they call a merger of equals to shareholders.
The combined company would have annual production of 1.6 million ounces, and would aim to raise that to 2.0 million ounces.
This would come from three production centres at Kalgoorlie and Yandal in Western Australia, and North America.
Northern Star would acquire all shares in Saracen. Saracen shareholders would receive 0.3763 Northern Star shares for each Saracen one. Saracen would also pay a special, fully-franked dividend of 3.8 cents per Saracen share.
Northern Star shareholders would own 64 per cent of the merged company. Saracen shareholders would own 36 per cent.
Northern Star boss Bill Beament would remain executive chair. Saracen managing director Raleigh Finlayson would be managing director, while Northern Star Stuart Tonkin would be chief executive.
The deal must still be approved by courts and shareholders.
At 1127 AEDT, shares in Northern Star were up by 7.31 per cent to $14.83.
Shares in Saracen were higher by 7.47 per cent to $5.61.