Catalyst offers $66m in Vango takeover

Perth-based Catalyst Metals announced it has agreed on $66 million for its off-market scrip takeover bid of Sydney-headquartered gold explorer Vango Mining.

Catalyst Metals announced on the market today that it had entered a bid implementation agreement with Vango Mining to acquire all of Vango's ordinary shares, as part of its strategy to control high-grade gold belts in Australia.

Under the offer, Vango shareholders would be entitled to five fully paid Catalyst shares for every 115 Vango shares held.

Catalyst Metals' announcement said the implied value of the offer was about $66 million, or 5.2 cents per Vango share.

“On successful completion of the offer, Vango shareholders will own approximately 35.7 per cent of the enlarged Catalyst,” the company said.

"Vango major shareholders and directors, Hunter Guo and Carol Zhang, have entered into binding pre-bid acceptance agreements with Catalyst in respect of a total of 252 million Vango Shares, representing 19.99 per cent of current Vango shares.

"In addition, Vango shareholders who collectively own or control a further 670 million Vango shares, representing 53 per cent of all Vango Shares, have stated their intention to accept the offer for all of those Vango shares, in the absence of a superior proposal."

If completed, the transaction would expand Catalyst’s portfolio with the addition of Vango's tenements, including a 75-kilometre tenement package in Victoria, a Tasmanian tenement operating the Henty Gold Mine, and the Marymia gold project in Western Australia’s gold belt.

The Marymia gold project comprises 45 granted mining leases covering more than 325 square kilometres of land about 300 kilometres north-east of Meekathara.

“Bringing together Marymia’s huge exploration upside and the funding and technical knowledge of Catalyst makes enormous sense for all shareholders,” Vango executive chairman Bruce McInnes said.

“It is the ideal recipe to create value for all Vango shareholders and therefore the board supports the bid unanimously.”

Catalyst Metals also announced it was in talks with Superior Gold Inc, the owner of the Plutonic gold mine operating adjacent to the Marymia Gold Project.

According to Catalyst, the combined Marymia-Plutonic Resource would be almost 7 million ounces with a 3 million tonnes per annum plant.

However, Catalyst said there was no guarantee a transaction would occur with the parties involved in commercial discussions only.

Catalyst managing director and chief executive James Champion de Crespigny said the transaction would turn a new leaf for the future of both companies.

“The combined group will have the financial strength and technical expertise to unlock the value of the prospective Marymia tenements,” he said.

“There is immense potential to create significant value for all shareholders by driving an aggressive exploration strategy on what has already proven to be a 15 million ounce Australian gold belt."

Catalyst Metals was advised by Argonaut and Gilbert + Tobin.