Gold Road Resources (ASX: GOR)

Has made a unanimously recommended off-market takeover offer for DGO Gold, ASX: DGO), at an implied offer price of A$3.55 per share.

The offer is conditional upon an 80% acceptance by DGO shareholders.

 

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Gold Road	ASX : GOR
Stage	Production   (50% JV)
Metals	Gold
Market cap	A$1.33 Billion   @ A$1.50
Location	Laverton, Western Australia

 

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GOLD ROAD MAKES RECOMMENDED TAKEOVER OFFER FOR DGO GOLD LIMITED

 

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Gold Road Resources (ASX: GOR) has made a unanimously recommended off-market takeover offer for DGO Gold, ASX: DGO), at an implied offer price of A$3.55 per share.

The offer is conditional upon an 80% acceptance by DGO shareholders.

DGO owns a portfolio of prospective exploration and mining assets which includes:

▪ a ~14.4% shareholding in ASX listed De Grey Mining Ltd (the owner of the 9 million
ounce Mallina Gold Project in Western Australia);
▪ a ~6.8% shareholding in ASX listed Dacian Gold Ltd (the owner of the Mt Morgans gold mine);
▪ a ~20.1% shareholding in ASX listed Yandal Resources Ltd (an exploration company
focused on the Yandal Greenstone belt); and
▪ an attractive portfolio of exploration tenements in the Pilbara, Yilgarn, Bryah and
Stuart Shelf Provinces.

 

The Offer

▪ All scrip offer of 2.16 Gold Road shares for every DGO share, implying an offer price of $3.55 per share, and an equity value of approximately A$308 million (diluted basis)

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The Gold Road offer represents an attractive and significant implied premium for DGO shareholders at various volume weighted average share prices (VWAPs):

o 20% over the last trading day VWAP of $2.91 for DGO Shares, at an implied offer price of $3.49 based Gold Road’s last trading day VWAP;
o 28% over the 10 day VWAP of $2.77 for DGO shares, at an implied offer price of $3.55 based on Gold Road’s 10 day VWAP; and 37% over the 30 day VWAP of $2.60 for DGO shares, at an implied offer price of $3.56 based Gold Road’s 0 day VWAP

The offer represents a compelling opportunity for DGO to unlock value in its portfolio, whilst providing shareholders with diversification and ongoing exposure to DGO’s assets through a shareholding in a larger, more liquid, ASX 200 gold producer.

DGO Directors unanimously recommend DGO shareholders accept the offer in the absence of a superior offer, and intend to accept the offer for all shares they own or control (representing ~16% of DGO’s shares on issue) 21 days after the offer opens, in the absence of a superior offer.

▪ The offer is subject to an 80% minimum acceptance by DGO shareholders, no disposal of any marketable securities and other standard conditions.

 

GOR intends to waive all remaining conditions within 6 business days after the
80% acceptance condition is met. At this time the offer will become unconditional.

 

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For brevity, this summary has been abridged, to read the full news release, please click HERE

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Companies featured here have either presented to the Circle in London, or have been selected because they are considered to have interesting projects, in good jurisdictions, run by an experienced management team.

All information used in the preparation of this communication has been compiled from publicly available sources that we believe to be accurate and reliable, however, we cannot, and do not, guarantee the accuracy or completeness of this.

These articles are for awareness and informational purposes only, and are not recommendations in any form.  Always consult an investment professional.

 

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Disclosure

At the time of writing the author holds shares in Gold Road Resources, bought in the market at the prevailing price on the day of purchase.

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