Ramelius Resources has lodged an all-scrip takeover offer for the Lake Roe gold project.
Ramelius will acquire the Lake Roe gold project in WA from Breaker Resources. Lake Roe has a mineral resource of 32 million tonnes at 1.6 grams per tonne (g/t) gold, or roughly 1.7 million ounces.
Lake Roe provides additional scale through regional consolidation with Ramelius’ Rebecca Project, boasting almost 3 million ounces in combined mineral resources.
As payment for the acquisition, Breaker shareholders are set to receive an implied offer price of 40 cents per share, equating to 1 Ramelius share for every 2.82 Breaker shares.
The offer price represents a premium of 41.5 per cent to Breaker’s 30-day volume-weighted average price, totalling an equity value of 130.7 million.
Breaker’s directors unanimously recommended Breaker shareholders accept the offer.
Additionally, major Breaker shareholders, Electrum and Paulson, representing a combined 19.92 per cent of Breaker’s shares, have signed pre-bid acceptance agreements to accept Ramelius’ offer.
“Lake Roe is an outstanding opportunity for Ramelius to consolidate its Rebecca acquisition from 2022 with almost 3 million ounces in combined resources, underpinning a likely future production centre for the company,” Ramelius managing director, Mark Zeptner, said.
“The Breaker team has done an excellent job advancing Lake Roe… and have clearly demonstrated its potential for development into… what we believe is a tier-one gold mining region.”
Breaker chief executive officer, Sam Smith, said the acquisition was a logical and sensible combination of assets.
“For Breaker shareholders to swap their Breaker shares for Ramelius shares at an attractive premium and retain full exposure to the upside at Lake Roe is compelling,” he said.
“It provides an opportunity to share in the growth and economic impetus that a new long-term mining hub in the region can generate.”
In September last year, Breaker Resources divested its remaining shareholding in Global Lithium Resources (GL) to raise roughly $15 million in working capital.
At the time, the capital raise was focused on developing the Lake Roe gold project.