Western Australia may soon have a new force in gold with the announcement overnight that Doray Minerals has made a takeover offer to the board of Mutiny Gold.
Under the offer, Mutiny shareholders will receive 1 new Doray share for every 9.5 Mutiny shares held, valuing Mutiny at approximately A$36 million or 5.4 cents per share.
A statement released this morning said, “The combined group will have operational flexibility from two high-grade, low-cost production centres – Andy Well in the northern Murchison district and the Deflector project in the southern Murchison district of Western Australia – which combined are forecast to produce around 160,000oz AuEq per year from FY20165.”
“The transaction will create a leading mid-tier, high-grade Western Australian gold producer, which is expected to fill a growing investment void in the ASX gold sector and provide an attractive investment proposition for existing and new shareholders.”
Doray Chairman, Mr Peter Alexander, said the merger had strategic merit.
“The complementary nature of the two companies’ projects and the exceptional organic growth profile of the combined business will be a strong value driver for shareholders of both Mutiny and Doray,” said Mr Alexander.
“This acquisition will diversify Doray’s existing production centre at Andy Well with a high quality, development ready asset in Deflector, which once in production should double Doray’s annual
production,” he said.
“Doray’s interest in Mutiny was confirmed by the results from the recent ‘Mine Operators Review’ completed by the Mutiny management team under the leadership of Mutiny’s Managing Director, Mr Tony James, which validated and has significantly enhanced Deflector’s viability.”
“We also look forward to welcoming Mutiny’s Non-Executive Chairman, Allan Brown, to the board of the combined group as a Non-Executive Director, where his strong, long term understanding of the project will prove valuable.”
“Doray’s Board is confident that merging the assets of Doray and Mutiny, combined with the potential upside offered, places the combined group in a strong position to fill the growing investment void in
the mid-tier ASX listed gold sector.”
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