News: RMS UPDATE 1-Australia's Westgold to buy Karora Resources in $808 mln deal

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April 8 (Reuters) - Australia's Westgold Resources (WGX) said on Monday it has agreed to acquire Toronto-listed Karora Resources KRR.TO in a cash-and-stock deal worth about A$1.23 billion ($808.36 million), seeking its gold assets in Western Australia.

Under the deal, Karora shareholders will receive 2.524 Westgold shares, with A$0.68 in cash and 0.30 of a share in a new company to be spun off from Karora.

The deal implies an offer price of A$6.60 per Karora share, or C$5.90 a share, based on Westgold's last closing price and the Australian dollar to Canadian dollar exchange rate on April 5, representing a 10.1% premium to Karora's closing share price.

Karora Resources is focused on increasing gold production at its Beta Hunt gold mine and Higginsville gold operations in Western Australia and earlier ended buyout talks with another Australian gold miner, Ramelius Resources (RMS) .

"The prize here is Beta Hunt's gold potential. Rarely do you find a gold asset of the quality and potential of Beta Hunt hiding in a nickel belt and drilling is expected to further unlock value at this mine," Westgold CEO Wayne Bramwell said.

Upon completion of the deal, Westgold shareholders will own 50.1% of the combined company.

($1 = 1.5216 Australian dollars)