Australian gold producer and explorer Westgold Resources has announced a definitive arrangement agreement to acquire all shares of Karora Resources, creating a mid-tier gold miner with a market capitalisation of around A$2.2bn ($1.4bn).
The acquisition is set to establish a diversified gold company focused on Western Australia (WA), featuring a comprehensive portfolio of exploration, development and production assets.
The merged entity will have an annual gold production capacity of 400,000oz.
The transaction will be executed through a statutory plan of arrangement under the Canada Business Corporations Act (CBCA).
As per the terms of the agreement, Karora shareholders will receive a multifaceted offer for each share they hold.
The offer includes 2.524 Westgold fully paid ordinary shares, A$0.68 in cash and 0.30 of a share in a new company, SpinCo, which will be demerged from Karora.
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