Dundee said it supports OceanaGold's plans to buy Ausgold, in which it has a minority stake.

Under the terms of the transaction, Ausgold shareholders will receive 0.03365 share of OceanaGold for each share of Ausgold held, 1.36 Australian dollars (96 U.S. cents) per Ausgold share, implying a total transaction equity value of around A$776 million.

Dundee currently owns roughly 42.5 million Ausgold shares and 3.3 million warrants representing 7.7% interest in Ausgold on an undiluted basis, and an 8.3% interest in Ausgold on a partially diluted basis.

For just its 7.7% interest, the value of the stake would be worth around A$57.8 million at the offering price.

"We are pleased to support this transaction, which recognizes the value and quality of the Katanning Gold project and provides shareholders with both an attractive premium and continued exposure to future upside through OceanaGold," Dundee Chief Executive Jonathan Goodman said.