The enlarged company resulting from the merger of Great Panther Silver and Beadell Resources will include three mining operations in Mexico and Brazil in addition to the former’s Coricancha polymetallic project in Peru.
Great Panther Silver is engaged in the production of the Guanajuato Mine, San Ignacio Mine and the Topia Mine in Mexico. On the other hand, Beadell Resources, which is listed on the Australian Stock Exchange (ASX), owns and operates the Tucano Gold Mine in the Amapá state in northern Brazil.
Great Panther president and CEO James Bannantine said: “Great Panther brings the capital to deliver on Tucano’s substantial near- and long-term resource growth potential and to continue mine optimization initiatives.
“The combination of assets, capital and management provides a unique opportunity to unlock a significant re-rating potential for the benefit of both existing shareholders and Beadell’s shareholders who will gain a meaningful interest in Great Panther.”
The merger will see the Canadian miner contributing four million silver-equivalent ounces of production in 2018, and the Brazilian gold producer contributing 130,000 gold ounces in 2018 and an additional 163,000 ounces in 2019.
Under the merger terms, shareholders of Beadell Resources will be issued 0.0619 shares of Great Panther Silver in exchange of each share they hold in the Brazilian gold producer.
Following the completion of the merger, shareholders of the Canadian firm will hold a stake of 62% in the enlarged precious metals company while Beadell Resources’ shareholders will own the remaining stake of 38%.
The transaction values each of the Beadell Resources shares at A$0.0863 ($0.063), giving it an implied equity value of around A$144m ($105m).
Beadell Resources CEO and managing director Nicole Adshead-Bell said: “By undertaking this transaction, Beadell shareholders will benefit from Great Panther’s strong balance sheet, steady cash flow, experienced management team and improved market liquidity via Great Panther’s TSX and NYSE American listings.
“The combined company will pool resources to expedite the execution of Tucano’s ongoing operational turnaround.”
Great Panther Silver acquisition of Beadell Resources will be subject to shareholder and regulatory approvals apart from other customary conditions.
