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Kirkland Lake Gold (TSX: KL) (NYSE: KL) (ASX: KLA) has significantly reduced its stake in Novo Resources Corp. (TSXV: NVO) with the sale of 18.5 million units at a price of C$2.45 per unit.

Each unit consists of one Novo common share and one-half of a common share purchase warrant held by Kirkland. Each whole warrant would entitle the holder thereof to acquire one additional Novo share owned by Kirkland at an exercise price of C$2.80 for 12 months.

The transaction is expected to generate cash proceeds of approximately C$45.3 million to Kirkland, and will be completed through private placements being facilitated through Stifel GMP and Clarus Securities.

Prior to the transaction, Kirkland held approximately 27.9 million Novo shares, representing an interest of about 12.1% in the Pilbara-focused explorer. The sale would bring Kirkland’s ownership to around 9.4 million shares, or 4.1%.

Should the warrants be exercised in full, Kirkland would dispose of an additional 9.25 million Novo shares for gross proceeds of C$25.9 million. This would leave Kirkland with only an approximate 0.05% ownership of Novo’s currently issued and outstanding shares.

Kirkland said it intends to use the net proceeds from the asset sale for general corporate purposes.

A portion of the sale represents a loss to Kirkland, which purchased more than half of the units at a price above C$4.00 per unit.

Novo’s stock was trading at C$2.38 as of Thursday’s market close. The issuer has a market capitalization of C$438.6 million.