Ramelius owns the Edna May mine.
Australian gold miner Ramelius Resources on Friday confirmed it is in discussions with Karora Resources for a potential acquisition of the Canada-based mine operator.
Shares of Ramelius were up 3.2% at A$1.595, as of 01:20 GMT, and are set for their best week since early December, if gains hold. The broader benchmark S&P/ASX 200 index rose in tandem to add nearly 1% in value.
The company, however, clarified the discussions were ongoing without any certainty of closure.
The Australian Financial Review valued the transaction to be between A$700-million and A$1-billion, according to a report published by the local daily on Thursday.
Karora's market capitalization stood at C$841-million as at market close on March 6, Ramelius said.
"There is no certainty that the discussions will lead to a transaction and if so, at what price," the company added.
Karora did not immediately respond to a Reuters request for comments.
Toronto-listed Karora is a gold producer and owns and operates two gold mines in Western Australia.
This deal would strengthen Ramelius' chances of touching its 2024 financial year gold production forecast of 265 000 oz to 280 000 oz.