Westgold Resources and Karora Resources have successfully completed their merger with the newly formed entity being dual listed on the ASX and Toronto Stock Exchange (TSX), boasting a pro forma market capitalisation of $2.5 billion (C$2.3 billion) and establishing itself as a top-five gold producer in Australia.
Under the merger agreement, Westgold acquired 100 per cent issued and outstanding shares of Karora, offering each Karora shareholder 2.524 Westgold shares, C$0.608 in cash, and 0.30 of a share of Culico Metals, a spin-off from Karora.
Westgold managing director and chief executive officer (CEO) Wayne Bramwell emphasised the strategic benefits of the merger.
“Today marks the next phase of Westgold’s evolution into a larger, unhedged and well-funded Australian gold producer,” he said. “Our value proposition is significantly enhanced with an expanded team, quality operating assets, and an enviable pipeline of exploration prospects across two of Australia’s most productive gold fields.
“The merger with Karora upsizes our Western Australian operating platform – an extensive and established asset base that can be increasingly leveraged for free cash generation and growth.
“Westgold commences this new growth phase with a robust balance sheet and a plan focussed on realising a potential $281 million (C$254 million) in corporate cost savings and $209 million (C$189 million) in operating synergies.
Karora chairman and CEO Paul Huet expressed enthusiasm for the merger, describing it as a “transformative step” for the company.
“The combination of Karora and Westgold to create a new Westgold is a transformative step that will ensure growth continues as an unhedged gold producer in a historically robust gold market,” he said.
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