Court decision, Gold, M&A, News, Red 5

Court approves Silver Lake–Red 5 merger

It’s been an exciting week for Silver Lake and Red 5 Resources as the Supreme Court of New South Wales approves the companies’ bid to merge.

Orders were made yesterday at the Supreme Court approving a scheme of arrangement under which Red 5 will acquire 100 per cent of Silver Lake shares.

Silver Lake intends to lodge an office copy of the Court’s orders with the Australian Securities and Investments Commission today, after which the scheme will become legally effective.

Once the scheme comes into play, Silver Lake will delist from the ASK and new Red 5 shares will commence trading on June 20.

Silver Lake shareholders backed the move earlier this week.

The merger is set to create a diversified mid-tier gold company producing around 445,000 ounces per annum, firmly establishing the merged entity as a mid-tier company.

Silver Lake acquired 11 per cent of Red 5’s shares back in September 2023. Now, Silver Lake shareholders are set to receive 3.434 Red 5 shares for every Silver Lake share held.

In a presentation announcing the merger, the two companies said it will “provide Red 5 and Silver Lake shareholders with the opportunity to participate in a stronger combined group, delivering benefits not available on a standalone basis”.

The merged group management team will be led by Luke Tonkin from Silver Lake as managing director and chief executive officer. Tonkin will be supported by Richard Hay from Red 5 as chief operating officer and Struan Richards from Silver Lake as chief financial operator.

Once the merger is finalised, the company will have ownership of four gold projects: King of the Hills (KOTH), Deflector and Mount Monger in WA, and Sugar Zone in Ontario, Canada.

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