Argonaut has acted as financial advisor to Mutiny Gold Limited (ASX: MYG) (“Mutiny”) on the proposed merger with Doray Minerals Limited (ASX: DRM) (“Doray) to form a leading mid-tier, high-grade Western Australian gold company with substantial growth prospects which is expected to fill a growing investment void in the ASX gold sector and provide an attractive investment proposition for existing and new shareholders.
Under the terms of the Bid Implementation Agreement (BIA) entered into by the two companies Doray is to acquire all of the issued ordinary shares and listed options in Mutiny via an off-market takeover offer with Mutiny shareholders receiving 1 new Doray share for every 9.5 Mutiny shares held, valuing Mutiny at approximately A$36million or 5.4 cents per share.
The combined group will have operational flexibility from two high-grade, low-cost production centres: Andy Well in the northern Murchison district and the Deflector project in the southern Murchison district of Western Australia, which combined, are forecast to produce around 160,000oz AuEq per year from FY 2016.
Commenting on the merger, Mutiny Chairman, Mr Allan Brown said “the transaction is compelling for Mutiny shareholders. In addition to a significant premium the transaction provides Mutiny shareholders with the opportunity become shareholders of a standout multi-mine, high-grade, gold-focused Western Australian mid-tier producer with strong growth prospects.
It allows our shareholders to continue to have a significant interest in the upside associated with the development of Deflector, while mitigating and diversifying the current development risks associated with being a single asset company.
The Mutiny Board believes that this transaction is in the best interests of Mutiny and unanimously recommends it to our shareholders, in the absence of a superior proposal.”
Additional information regarding the Company and the Merger can be found on the company’s website at www.mutinygold.com.au.