Ground Breakers: Plot twists keep coming in gold mining M&A madness
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Two of the gold sector’s most absorbing takeover battles are hitting a crescendo today, with Westgold Resources’ (ASX:WGX) bid to upend Gascoyne Resources’ (ASX:GCY) merger with Firefly (ASX:FFR) hanging over a key court hearing and Ramelius Resources (ASX:RMS) upping the stakes on Gold Road (ASX:GOR) in the hunt for Apollo Consolidated (ASX:AOP).
The lay of the land in the Westgold-Gascoyne courtship is complicated.
Gascoyne lined up a merger with junior explorer Firefly back in June, a move that would have given the Dalgaranga gold project owner control of the 193,000oz Melville gold deposit and consolidated a 1200km2 exploration belt between Mount Magnet and Yalgoo.
Westgold emerged late in the piece to make a 1 for 4 share offer for Gascoyne, but only if it dumped the Firefly deal.
After much ‘umming and ahhing’ Westgold eventually convinced Gascoyne’s top shareholders to back the deal after increasing its consideration to a 53c a share, 3 for 11 offer. It then received a begrudging admission from its target that the proposal was superior.
Only one issue: according to its scheme implementation deed Gascoyne can’t dump the Firefly transaction, only the target can.
With the Takeovers Panel declining to intervene on Westgold’s behalf, It has led to an unusually interesting second court date for the Firefly-Gascoyne scheme today in WA after Firefly shareholders voted up the Gascoyne merger last week.
We wait with bated breath.
Gold Road’s $166 million, 56c a share all cash offer for Apollo a couple weeks ago seemed to trump Ramelius’ initial 34c plus shares bid for the junior goldie and its 1.1Moz Rebecca gold project.
It employed a bit of dark magic as well, building up a 19.9% stake to block the initial Ramelius bid, which was conditional on a 90% acceptance.
But Ramelius has proven a successful acquirer of assets in recent years and MD Mark Zeptner had more cards to play.
Today Ramelius has opened a revised and improved bid, launching a 62c a share offer valued at $181 million. The new offer is unconditional, consisting of 34c in cash and 0.1778 Ramelius shares for every unit of Apollo stock.
It has the Apollo board on side as well as a major shareholder, with Ramelius to build its own 19.9% stake in the company.
The ball is back in Gold Road’s court.
Former Northern Star Resources (ASX:NST) boss Bill Beament has finally divulged more details on the new underground mining services business he announced to the world at Diggers and Dealers back in August.
Develop (ASX:DVP) is the former gold boss’ company which is “not in gold”, but is now potentially back in gold because its been invited to tender for the mining services contract at the Bellevue Gold Mine.
The allure for Beament, who wants DEVELOP (the former Venturex Resources) to use mining services to drive global decarbonisation — however that works — is the “green and gold” mantra of Bellevue.
The company at its AGM last month launched an ambitious plan to become Australia’s first net zero gold miner, leveraging the high grade of the Bellevue resource.
DEVELOP said in its statement “Bellevue Gold’s stated commitments on ESG and their project’s superb credentials, makes this tender a great opportunity aligned to DEVELOP’s own core beliefs.”
“We are delighted to be given the opportunity to tender for the mining contract at Bellevue, which is clearly on the path to joining this list of world-class WA projects,” Beament said.
“With a Resource grade of 6gpt and forecast production of 200,000oz a year at an all-in sustaining cost of just A$922/oz, Bellevue is about to join an exclusive global club of gold miners.
“There are only seven other mines in tier-one locations that can boast these metrics.”
Beament has unsurprisingly headed back to the Northern Star well for his first two appointments, taking NST’s Paul Nilsson and Aaron Armstrong in as DEVELOP’s mining and maintenance managers.
$450 million capped DEVELOP, which also owns the Sulphur Springs copper project in the Pilbara, has been on a tear since Beament entered the company, recording a 400% year to date bump in its share price.