Australian miners Horizon Minerals (ASX: HRZ) and Greenstone Resources (ASX: GSR) have agreed to merge in an all-stock deal to create a new emerging gold producer in Western Australia’s goldfields.
The combined company, which will continue to trade as Horizon Minerals, would have global mineral resources of around 1.8 million gold ounces. It would also hold exploration assets in the gold mining hubs of Kalgoorlie and Coolgardie. Horizon has a market cap of A$22.1 million ($19.4 million) with Greenstone at A$7.7 million ($6.8 million).
The transaction will see Horizon buying 100% of the ordinary shares in Greenstone and 100% of the listed Greenstone options. Upon completion, Horizon shareholders will own 63.1% of the merged entity, which will continue to operate under the Horizon Minerals brand. Greenstone shareholders will own the remaining 36.9% of the combined business.
“This really is a logical consolidation of complementary assets, which creates greater potential for Horizon to unlock the value within our longer project pipeline,” the company’s chief executive officer, Grant Haywood, said in the statement.
The combined mining company will be pursuing its growth strategy from a position of greater market scale, underpinned by a cash and listed investments balance of about $14.9 million and a lower consolidated cost base, they said.
The merger is expected to be completed in June.
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