PERTH (miningweekly.com) – ASX-listed juniors Intermin Resources and MacPhersons Resources have struck a merger agreement to create a gold company holding some 1.15-million ounces of gold.

Under the terms of a scheme of arrangement, one Intermin share will be issued for every 1.8227 MacPhersons shares held, valuing the takeover target at 8.25c a share.

On completion of the transaction, Intermin shareholders will hold a 55% interest in the merged entity, with MacPhersons shareholders retaining a 45% interest.

MacPhersons owns the Boorara gold project, some 10 km east of Kalgoorlie, which has a mineral resource estimate of 507 000 oz of gold, as well as the Nimbus project, which has a mineral resource estimate of 78 000 oz of gold, 20-million ounces of silver and 104 000 t of zinc.

Intermin, for its part, has a mineral resource estimate of 562 000 oz contained in the Kalgoorlie, Coolgardie and Menzies region, and has several active joint ventures, including at the Richmond vanadium project, in Queensland.

The board of MacPhersons has unanimously recommended that shareholders accept the Intermin offer in the absence of a superior proposal, and subject to an independent expert finding the offer to be in the best interest of shareholders.

“The combined technical and commercial skills of the two companies is expected to greatly enhance the merged group’s capabilities. This is a transformational deal which is intended to create the economies of scale necessary to undertake a standalone development,” said MacPhersons MD Jeff Williamson.

“Together, we will have a strong board and management team, large resource base of more than one-million ounces of gold, growth options in multiple commodities and a clear development and production strategy in the Western Australian goldfields.”

Intermin MD Jon Price told shareholders that the logical consolidation of the complementary assets would provide the critical mass to underpin a larger scale production profile, improved balance sheet and stronger business.

“Combining MacPhersons’ large baseload Boorara deposit with the nearby, higher-grade Intermin projects should enable a more rapid pathway to production with sufficient scale to avoid the need for third party toll milling.”

Price said that the merger was consistent with Intermin’s growth strategy to create value for shareholders through aggressive, self-funded exploration and value accretive acquisitions.

On completion of the merger, the combined company will start a prefeasibility study for the integrated development of the existing gold projects. The likely aim of the study would be to develop an initial minimum four-or five-year mine plan supporting a standalone carbon-in-leach processing facility.

The merger is subject to a number of conditions, including regulatory and shareholder approvals, and the receipt of third party consents.