AuStar Gold is set to acquire all of the debt owed by Centennial Mining and Maldon Resources from Mining Lending.
Upon completion of the agreement, AuStar will replace Mining Lending as a major secured creditor of Centennial Mining and Maldon Resources, with security over the assets of both companies.
AuStar announced its move to acquire Centennial Mining last year, following the latter’s appointment of administrators in March.
Centennial Mining owns the Maldon processing plant near Bendigo and was developing and producing gold from the A1 underground mine near Woods Point in Victoria.
The A1 mine is 15 kilometres from AuStar’s Morning Star mine.
AuStar has begun working towards a deed of company arrangement with Centennial Mining creditors since May last year.
The company is set to continue working with the deed administrators and Centennial Mining creditors to complete the proposed acquisition.
AuStar plans to withdraw its entitlement offer to shareholders given the uncertainty of the terms of the takeover.
It will release further announcements as these matters progress.