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Highlights
- Mako Gold and Aurum Resources propose merger to create a strong West African gold entity.
- The combined entity will focus on advancing projects in Côte d'Ivoire with a $20 million cash balance.
- Mako shareholders to hold 20.5% of the merged company, with Aurum shareholders owning the rest.
Mako Gold Ltd (ASX:MKG) has announced a proposed merger with Aurum Resources Ltd (ASX:AUE), aiming to establish a robust exploration and development-focused gold business in West Africa. This strategic merger will consolidate resources to create a more financially stable and efficient entity, with a focus on advancing the Napié and Boundiali gold projects in Côte d'Ivoire.
The merger will allow the new company to pursue a growth strategy with a strong $20 million cash balance and a lower overall cost base, enhancing the potential for more focused exploration efforts. Mako's managing director, Peter Ledwidge, highlighted the potential of the Napié Project, believing it could host multi-million ounces of gold. Mako shareholders will retain a significant stake in the merged entity, ensuring participation in the ongoing development of both the Napié and Boundiali projects.
Aurum managing director Dr. Caigen Wang expressed excitement about the Napié Project, noting its similarities to the successful Abujar project. Aurum's expertise in resource growth and cost-efficient drilling will play a key role in maximizing the potential of Napié. The merger will also bring together experienced teams from both companies, combining their skills in grassroots exploration, resource expansion, and project development.
The merger agreement involves an off-market takeover, with Aurum bidding for 100% of Mako’s shares and options. Mako shareholders are set to benefit from a 112% premium, with the combined entity estimated to have a pro-forma market capitalization of A$90 million. Post-merger, Mako shareholders will hold 20.5% of the company, while Aurum shareholders will own the remaining 79.5%.
The proposed merger is seen as a pivotal move toward creating a well-funded, low-cost West African gold explorer, with two key projects under its control. Napié, with its 868,000-ounce resource, and the rapidly evolving Boundiali project, which is targeting its maiden resource in late 2024, position the new entity for significant growth.
The strong financial position and expanded exploration capabilities, the merger brings together teams with proven track records in developing major gold assets. This merger is expected to unlock significant value as the combined entity advances its projects in one of Africa’s most promising gold regions.
