The takeover of Excelsior Gold by Spitfire Materials has received shareholder backing, paving the way for the merger implementation to proceed.
Excelsior shareholders approved the transaction on Wednesday. The Federal Court approval will be sought next week and, should that be given, the scheme will be implemented on October 3.
The merger will be implemented through a scheme of arrangement, with Spitfire to acquire all of the issued capital of Excelsior by issuing one new Spitfire share for every 2.208 Excelsior shares held. The transaction valued Excelsior shares at 4.43c a share based on the 30-day volume-weighted average price of Spitfire shares.
Following the merger, Spitfire shareholders will hold a 58.3% share of the merged entity, with Excelsior shareholders holding the remainder.
The companies have said that their merger will create an ASX-listed gold company with a diversified portfolio of exploration and development assets and a clear pathway to production in the North Kalgoorlie region of Western Australia.
The merger will also allow for synergies to be exploited between neighbouring North Kalgoorlie gold projects, located between 35 km and 70 km north of Kalgoorlie in Western Australia, along the highly prospective Bardoc tectonic zone within an almost contiguous landholding of about 200 km2.
The merged entity will have a combined indicated and inferred mineral resource inventory of more than 2.1-million ounces, which the companies say will provide the critical mass required to accelerate development plans with the aim of becoming a recognised midtier gold producer.