# Mergers and Acquisitions hit the Gold Sector!



## YOUNG_TRADER (11 July 2006)

The first of many I would assume,


I wonder who'll be next, 

Stocks like ATV, IGR, NAV, CRE, EKM, all come to mind in the juniour end with others like

BMO, AVO, TRY, LVR at the small/mid level


Oceana and Climax get into bed 

Michael Vaughan
Tuesday, July 11, 2006

MERGER activity has hit the Australian gold sector for the first time in the current cycle now that Oceana Gold and Climax Mining have agreed to merge to create a company that will likely be producing 550,000 ounces of gold equivalent by 2008.



Climax's Dinkidi gold-copper project 

The two Australian companies with overseas projects – Oceana in New Zealand and Climax in the Philippines – expect to put the proposed merger to shareholders in late October.

The terms of the merger will see Climax shareholders given 0.62 of a share in Oceana for every share in Climax held along with 0.31 of an option to acquire an Oceana share for 92.5c. The options will mature in 30 months.

Climax option holders will receive the equivalent value for their options.

Oceana says the offer represents a 27% average to the weighted average of Climax shares for the 30 days prior to the announcement. Climax shares have retreated from a high of 72c reached in mid-May.

The merged company, to be known as Oceana Gold, will be about 44% owned by Climax shareholders. It will have a market capitalisation of $A523 million based on the two companies' respective share prices at close of trade yesterday.

Oceana's flagship project is the Macraes gold mine on New Zealand's South Island that produced 170,019oz in the 2005 calendar year. 

The company is also developing the Globe Progress mine in the Reefton gold field in New Zealand as well as the Frasers underground project to access the deeper portions of the Macraes ore body.

Climax is in the process of arranging the financing and offtake arrangements for its Dinkidi copper-gold project in the Philippines that is forecast to produce 130,000oz of gold and 14,000 tonnes of copper concentrate annually.

The proposed merged entity will have a reserve base of 4.8 million ounces gold equivalent and a production profile including gold, copper and silver from the two companies' mines in New Zealand and the Philippines.

In a joint statement, the two companies said the merger will allow them to pursue growth opportunities throughout Australasia and give better access to development capital.

Current Climax chairman Jim Askew will become the new chairman of the merged company and Oceana chairman Kerry MacDonald will act as deputy chairman.

Oceana chief executive Stephen Orr will continue on in the same position with the new company.

Both companies have agreed to a $2.5 million break fee.

Oceana gold shares pulled back from early gains to close unchanged at 82c, capitalising the company at $275 million. Climax shares closed up 3c (6%) at 53c leaving the company with a market capitalisation of $227 million.


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## Uncle Festivus (3 May 2008)

I'm inclined to think another 'round' of consolidation is about to commence in the gold sector soon, based on the current suppressed/oversold levels of gold company share prices and cycle lows.
I put forward LGL as a top contender at current levels, even with the disapointing production figures. 2 steps forward, one step back with them, just have to enter on the one step back. Still probably 25% upside from these levels even without a takeover premium.
Any other contenders?


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## So_Cynical (3 May 2008)

I Think there some chance TRY-Troy resources may go after an explorer

TRY has cash and equity's of around 30 mill, no debt and in production at there new Brazilian mine...TRY need a second income stream to make the leap to mid tier producer, so i reckon they could go after an explorer with proven reserves.

IMO

Perhaps we should be talking targets...who are the 3 best explorers?


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## james_tiz (25 July 2008)

Im new to this whole forum but have been in the market for some time.  A share that i have been with since the start is PNA.  With that thought of consolidation within the industry i think it would be a targeted company with its positive results in its exploration of its reserves and achieving targets throughout the stages.  I see the new low price makes it even more attractive


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## BeterValue (13 October 2009)

Allied Gold (ALD) made a offer for Australian Solomons Gold (ASG - Canada) with ASG investors getting .85 of an ALD share.  ASG's biggest share holder with ~48% holding, already agreed in principal and deposited their shares in and holding account.  Some conditions apply.  

Allied Gold hope that the skills they've build in PNG will help them developing the resource in the Solomons.


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