en.Wedoany.com Reported - Australian gold producers Regis Resources and Vault Minerals have announced a major gold merger, with a transaction value of approximately A$10.7 billion (US$7.7 billion). The combined company will become Australia's third-largest ASX-listed gold producer, expected to produce over 700,000 ounces of gold annually from assets in Australia and Canada.

Under the agreement, Regis will offer 0.6947 shares for each Vault share, valued at approximately A$5.15 billion, representing an 11% premium to Vault's last closing price. Upon completion, Regis shareholders will hold approximately 51% of the combined company, with Vault investors holding 49%. The boards of both companies have unanimously recommended the transaction.

Regis CEO Jim Beyer stated in the announcement: "This merger will create Australia's third-largest primary ASX-listed gold producer, which requires global recognition." He added that the combined company will have approximately A$1.9 billion in cash and gold, along with growth pipelines including the McPhillamys development project and Sugar Zone.

This gold merger reflects a trend among mid-tier producers in the industry seeking economies of scale and financing channels. The combined group is expected to generate approximately A$1.7 billion in free cash flow annually and benefit from over A$500 million in tax synergies, while maintaining a debt-free balance sheet.

In terms of market reaction, Regis Resources shares fell 5.9% to A$6.75 in Sydney on Tuesday, with a market capitalization of A$5.11 billion; Vault Minerals shares rose 3.1% to A$4.64, with a market capitalization of A$4.8 billion.

Regarding asset portfolios, Regis's Duketon complex in Western Australia holds 1.39 million ounces of gold reserves, while its 30%-owned Tropicana joint venture has 576,000 ounces. Vault contributes the Leonora hub (2.79 million ounces) and the Sugar Zone project in Ontario, Canada (389,000 ounces). The combined company will have total ore reserves of 6 million ounces and mineral resources of 20.5 million ounces.

Furthermore, the merged group will also control the McPhillamys open-pit project in New South Wales, which has a resource of 2.66 million ounces. The company plans to resume production at Sugar Zone in FY2028 after obtaining permits.

The two companies stated that the merger will achieve diversified production, supported by a crushing capacity of over 22 million tonnes per annum across nine plants, with the potential to increase to 24 million tonnes per annum in the future. The enlarged group will retain the Regis name, be headquartered in Perth, led by Jim Beyer, with Russell Clark as Non-Executive Chairman, and a board composed equally of members from both sides. This gold merger is expected to be completed in August or September, subject to shareholder, court, and regulatory approvals.

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