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Evolution Mining Limited (ASX:EVN) has revealed plans to issue 20,780,002 fully paid ordinary shares to acquire 100% ownership of Carnaby Resources Limited (ASX:CNB) through a Scheme of Arrangement. Under this arrangement, CNB shareholders will receive 0.0682 EVN shares for each CNB share held, valuing the transaction at approximately AUD $213 million. The acquisition awaits Court approval, Australian Competition and Consumer Commission (ACCC) clearance, and CNB shareholder consent, with a targeted share issue date of 13 November 2026.
Key Points
- Evolution Mining Limited (EVN) to issue 20,780,002 fully paid ordinary shares as consideration for acquiring all shares of Carnaby Resources Limited (CNB)
- The acquisition is structured as a Scheme of Arrangement, offering CNB shareholders 0.0682 EVN shares per CNB share
- Estimated transaction value stands at AUD $213 million, with the proposed share issue scheduled for 13 November 2026
- Completion contingent upon Court approval (due 4 November 2026), ACCC clearance (due 3 November 2026), and CNB shareholder approval (due 28 October 2026)
- Acquisition targets copper growth opportunities, particularly at the Ernest Henry operations
- No approval from EVN shareholders is required for the share issuance under ASX Listing Rule 7.1
Evolution Mining's Strategic Move to Boost Copper Production via Carnaby Resources Acquisition
Evolution Mining Limited, a prominent Australian miner with interests in precious and base metals, announced on 27 July 2026 its intent to acquire Carnaby Resources Limited through a Scheme of Arrangement. This acquisition aims to enhance Evolution's copper portfolio, especially by integrating Carnaby's assets with Evolution's existing Ernest Henry operations. The use of a Scheme of Arrangement facilitates a regulated and shareholder-protected merger process.
The transaction involves issuing over 20.7 million new fully paid shares of Evolution Mining as consideration, rather than cash payment. CNB shareholders will convert their holdings into Evolution shares at an exchange ratio of 0.0682 EVN shares per CNB share, effectively making them Evolution shareholders post-completion. This approach aligns with Evolution's strategy to expand its base metals footprint through targeted acquisitions.
Scheme of Arrangement Details and Share Exchange Ratio for Carnaby Shareholders
The acquisition is structured as a Scheme of Arrangement, a formal legal procedure under Australian corporations law that requires shareholder approval and Court sanction. Carnaby shareholders will receive 0.0682 new Evolution Mining shares for each CNB share they own, reflecting the agreed transaction value. This process ensures protections for both parties through multiple approval stages.
The total consideration is valued at approximately AUD $213 million, based on the issuance of 20,780,002 Evolution shares. The final share count will depend on the number of Carnaby shares outstanding when the scheme becomes effective. No cash alternative or additional consideration is offered beyond the share exchange.
Regulatory Approvals and Conditions for Transaction Completion
The acquisition is subject to several key approvals: Carnaby shareholder approval by 28 October 2026, ACCC clearance by 3 November 2026, Court approval by 4 November 2026, and lodgement of the Court order with ASIC by 5 November 2026. As of the announcement date, none of these approvals had been secured. EVN shareholder approval is not required for the share issue, as confirmed under ASX Listing Rule 7.1.
The Court approval process is standard for Schemes of Arrangement, ensuring fairness and compliance. ACCC approval indicates potential competition law considerations, though specific details were not disclosed.
Timeline for Share Issue and Settlement
The proposed issue date for the 20,780,002 Evolution Mining shares is 13 November 2026, following the completion of all necessary approvals. The sequence begins with Carnaby shareholder approval on 28 October 2026, followed by ACCC clearance on 3 November, Court approval on 4 November, and ASIC lodgement on 5 November. This phased approach ensures regulatory compliance before share issuance.
The shares to be issued are ordinary fully paid shares, identical to Evolution's existing ASX-listed shares, and will rank equally in all respects, including dividends and voting rights. No escrow or restrictions will apply, and no attaching securities are involved. Evolution plans to apply for quotation of these shares once the final issuance number is confirmed.
Compliance with ASX Listing Rules and Exemptions
Evolution Mining's share issuance does not require shareholder approval under ASX Listing Rule 7.1, as the transaction qualifies for exemptions related to acquisitions. The shares will not be issued under the 15% placement capacity or the additional 10% capacity under Listing Rule 7.1A. Additionally, no related party transactions under Listing Rule 10.11 are triggered, indicating no participation by directors or substantial shareholders in this issue.
No lead manager or broker has been appointed, and the transaction is not underwritten. While legal and advisory expenses are expected, no material fees related to the share issue were disclosed.
Focus on Ernest Henry Operations and Copper Growth Strategy
The acquisition targets copper growth opportunities at the Ernest Henry operations. Although detailed production or reserve data was not provided, Carnaby Resources is expected to bring complementary assets or exploration potential to Evolution's existing copper operations. This acquisition aligns with Evolution's strategic emphasis on expanding its base metals portfolio, particularly copper, through inorganic growth.
Further strategic details are available in a separate company update titled "Evolution Expands Copper Growth Opportunities At Ernest Henry Via Acquisition of Carnaby Resources" released on 27 July 2026.
Share Class and Quotation Plans
The new shares issued will be of the same class as Evolution Mining's current ASX-listed ordinary shares (EVN). Evolution intends to lodge an Appendix 2A with the ASX after determining the final number of shares issued under the Scheme of Arrangement to facilitate quotation in accordance with Listing Rule 3.10.3C.
This approach ensures CNB shareholders receive shares with identical rights and trading arrangements as existing Evolution shareholders, simplifying integration and market liquidity. No restrictions on resale within 12 months were specified, but any secondary sales will comply with Corporations Act provisions.
Impact on Dividend Policy and Capital Structure
Evolution Mining does not anticipate altering its dividend or distribution policy following the Carnaby acquisition, providing continuity for existing shareholders. The issuance of over 20.7 million new shares represents a significant increase in issued capital. While the acquisition is expected to contribute earnings supporting dividends, no specific financial forecasts or pro forma statements were disclosed.
Conditions and Contingencies for Closing
Completion depends on satisfying four key conditions: Carnaby shareholder approval by 28 October 2026, Court approval by 4 November 2026, ASIC lodgement by 5 November 2026, and ACCC clearance by 3 November 2026. Failure to obtain any of these approvals would prevent the transaction from proceeding as planned.
Share-Based Consideration and Transaction Structure
The acquisition is entirely share-based, with no cash component. The AUD $213 million valuation is derived from the exchange ratio and Evolution's share price at issuance. This structure preserves Evolution's cash resources and aligns Carnaby shareholders' interests with the combined entity's future performance. However, CNB shareholders bear the risk of share price fluctuations between announcement and issuance, as no price protection mechanisms were disclosed.
