Subiaco-based gold miner Perseus Mining has launched an all-scrip bid for London-listed Amara Mining in a deal worth about $85 million.
Subiaco-based gold miner Perseus Mining has launched an all-scrip bid for London-listed Amara Mining in a deal worth about $85 million.
Under the proposal, Perseus will issue Amara shareholders 0.68 new Perseus shares and 0.34 unlisted warrants for every Amara share at 44 cents each.
The offer price is a 32.8 per cent premium to Perseus’s 20-day volume weighted average price, and a 42.2 per cent premium to Amara’s mid-market closing price on Friday of 10.3 pence, valuing Amara at 14.6 pence a share, or £61 million ($85 million).
If the deal is successful, Perseus shareholders will hold a combined 64.9 per cent stake in the combined business, while Amara shareholders will hold the remaining 35.1 per cent interest.
“The proposal, which is subject to Amara shareholder and court approval and other closing conditions, aims to create a geographically diversified, multi-project company with a significantly enhanced gold production profile once development projects are progressively brought on stream,” Perseus said in a statement.
The combined business would own Perseus’s Edikan gold mine in Ghana and Amara’s Yaoure gold project in Cote d’Ivorie.
Perseus chief executive Jeff Quartermaine said if approved by Amara shareholders, the proposal has the potential to transform Perseus into a leading mid-tier West African gold producer.
“The opportunity to merge Perseus with Amara represents an outstanding opportunity to build strength through diversification,” Mr Quartermaine said.
“Amara’s Yaoure gold project is in our opinion one of the best undeveloped gold deposits in West Africa and will complement the other mines and projects under our management, which includes Edikan and the development-ready Sissingue gold project in Cote d’Ivorie.”
“The future of the combined group is very exciting as we are confident that by deploying our experienced human and financial resources to develop Amara’s Yaoure project, we will create an entity with considerable market presence, capable of generating material benefits for both groups of existing shareholders.”
Mr Quartermaine will retain his position while Amara directors John McGloin and Alex Davidson will join the five-person board of Perseus, which is headed by Reginald N Gillard.
Perseus closed 10.8 per cent lower to 37 cents each.
