Alkane Resources and Mandalay Resources Merger Creates a Leading Gold and Antimony Producer

Highlights:

• Alkane Resources Ltd and Mandalay Resources Corporation have agreed to a merger to form a diversified gold and antimony producer.

• The combined entity will operate across premier mining jurisdictions, with three producing mines in Australia and Sweden.

• The merger is set to enhance financial strength, increase institutional investment, and promote growth opportunities.

Alkane Resources Ltd (ASX:ALK) and Mandalay Resources Corporation have finalized an agreement to merge in a transaction known as a "merger of equals." This strategic move aims to create a diversified gold and antimony producer with operations spanning key mining jurisdictions in Australia and Sweden.

Continued Operation Under Alkane Resources

The newly formed entity will continue under the Alkane Resources name, with the company maintaining its listing on the Australian Securities Exchange (ASX). Additionally, the company plans to pursue a secondary listing on the Toronto Stock Exchange (TSX), reflecting its expanded global presence and reach.

Leadership and Governance

Alkane's current managing director, Nic Earner, will lead the combined company. The new board will consist of representatives from both Alkane and Mandalay, with seasoned mining industry veteran Andy Quinn taking on the role of chair. The leadership transition aims to capitalize on the strengths of both companies, driving future growth in the sector.

Merger Details and Share Structure

Under the terms of the merger, Mandalay shareholders will receive Alkane shares in exchange for their Mandalay holdings. Following the completion of the transaction, former Mandalay shareholders will own a majority stake in the merged entity. Alkane shareholders will retain the remaining stake in the new company, resulting in a balanced ownership structure that reflects the equal nature of the merger.

Diverse Mining Operations

The merger will result in a robust platform for gold and antimony production. The combined entity will be anchored by three established mining operations: Alkane's Tomingley gold mine in New South Wales, Australia, Mandalay's Costerfield gold-antimony mine in Victoria, Australia, and the Björkdal gold mine in Sweden. These assets are expected to contribute to the company's production growth in the coming years.

Financial Strength and Growth Prospects

The merger will position the combined entity with a strong balance sheet, including substantial cash reserves. These funds are expected to support both organic and inorganic growth initiatives, further driving the development of the company's existing operations and the exploration of new projects. Notably, the company plans to ramp up production at Tomingley and continue exploring the Boda-Kaiser copper-gold project.

Institutional Support and Market Liquidity

The merger is also expected to improve trading liquidity, which could lead to increased institutional interest and higher valuation in the market. By expanding its asset base and increasing its scale, the new entity is well-positioned to enhance its market standing and align with its peers listed on the ASX.

Regulatory and Shareholder Approvals

The merger transaction remains subject to approvals from shareholders, regulators, and courts. It is anticipated that the deal will close in the third quarter of the year, marking the beginning of a new chapter for Alkane and Mandalay.

As the deal progresses, the merger of Alkane Resources and Mandalay Resources is poised to create a stronger entity in the mining sector, leveraging complementary assets and a shared vision for future growth. With a focus on high-quality production and a strong balance sheet, the combined company is well-placed to explore further opportunities within the mining industry.

The merger also highlights the growing importance of ASX Mining Stocks in global markets, reflecting the increasing interest in diversified gold and antimony producers.