Regis Resources and Vault Minerals agreed on 5 May to combine in a merger of equals, with Regis acquiring 100% of Vault through a scheme of arrangement in a deal valuing the enlarged gold producer at about A$10.7bn.
Why Regis Resources Limited is buying Vault Minerals Limited
The two companies said the combination would create a senior producer with more than 700,000oz of annual output from five Western Australian operating hubs, combined mineral resources of 20.5Moz and ore reserves of 6Moz, two advanced development projects including McPhillamys and Sugar Zone, a debt-free balance sheet with about A$1.9bn of cash and bullion, and tax and cost benefits of more than A$500m.
Deal terms and financing
Vault shareholders were to receive 0.6947 new Regis shares for each Vault share, leaving Regis holders with about 51% and Vault holders about 49% of the merged company. Russell Clark was to chair the board and Jim Beyer to be managing director and chief executive, with four directors from each side. Each party agreed to a A$50.7m break fee.
Regulatory approvals and timing
The scheme needed Vault shareholder and court approval, regulatory clearances including the ACCC and a favourable independent expert's report; Regis shareholders did not need to vote. On 6 July Vault notified Regis that a Genesis Minerals proposal was a superior proposal, triggering a five-business-day matching right. Regis declined to counter on 13 July, and Vault terminated the deed and signed a scheme with Genesis on 14 July.
Market context
Genesis Minerals' rival offer valued Vault at about US$3.9bn, according to DealStreetAsia, against roughly A$5.1bn (about US$3.7bn) implied by the Regis terms in May.
