Published: December 13, 2022 |

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St Barbara has agreed to acquire rival Australian miner Genesis Minerals for A$541.3 million ($367.1 million) to create Hoover House, which will exclusively focus on the Leonora District in Western Australia.

The acquisition will be executed through a scheme of arrangement. As per the terms, shareholders of Genesis Minerals will exchange each of their shares in the company for 2.0338 shares of St Barbara.

In conjunction with the scheme of arrangement, St Barbara has agreed to demerge its Atlantic gold operations in Canada, the Simberi gold mine in Papua New Guinea, and other assets in Australia to its shareholders.

The demerged assets will be bundled into a new company called Phoenician Metals, which is intended to be listed on the Australian Securities Exchange (ASX).

As per the share exchange ratio, St Barbara’s shareholders will have a 38 percent stake in Hoover House, Genesis Minerals’ shareholders will have a 41 percent stake, while the remaining 22 percent stake will represent shares issued for the capital raise.

In Phoenician Metals, St Barbara’s shareholders will hold an 80 percent stake, while Hoover House will have a 20 percent stake.

“Sensible M&A is a key component of our multi-pronged growth strategy, and our team has a strong track record of executing accretive transactions. Consolidation of the world-class Leonora District is a natural fit for Genesis,” said Genesis Minerals Managing Director Raleigh Finlayson.

“The close proximity of the combined company’s core Leonora assets, the ability to unlock substantial synergies and the clear path to a market re-rate makes this the right deal for both Genesis and St Barbara shareholders,” added Finlayson.

Hoover House will target production of more than 300,000 oz of gold per annum, compared to St Barbara’s standalone FY23 production guidance of 145,000-160,000oz for Leonora with year-to-date actual production of 56,000oz.

“The merger with our Leonora neighbor, Genesis, to create Hoover House, will accelerate our Leonora Province Plan. Shareholders will reap the benefits of more production at lower cost and lower risk from this prolific mining district,” said St Barbara Chair Tim Netscher.

“A significant component of the value delivered by the creation of Hoover House is the unique synergies delivered by the resultant combination of assets, such as the ability to sensibly stage the development of the various orebodies and to match one party’s ore to the other party’s mill capacity,” added Netscher.

Genesis Minerals plans to raise an amount of A$275 million ($187 million) to fund Hoover House and facilitate the transaction, subject to the scheme of arrangement and demerger becoming effective. The funding is expected to come from AustralianSuper, Resource Capital Funds VII, and other institutional investors.

The implementation of the scheme of arrangement, which is subject to certain conditions such as approval from shareholders of both firms and others, is anticipated to be completed by May 2023.

Source: NS Energy

About St Barbara
St Barbara Ltd (Barbara) is a producer and explorer of gold. The company carries out the mining, exploration, development and distribution of gold and silver. Barbara operates Leonora gold mine in Western Australia, Australia; Simberi gold mine in Papua New Guinea; and Atlantic gold mine in Nova Scotia, Canada. The Leonora operations include Gwalia underground mine and a processing plant. Simberi operations include an open-pit gold mine and a processing plant. Atlantic gold operations comprise Touquoy open pit mine and associated processing plants. It has operations in Australia, Papua New Guinea and Canada. Barbara is headquartered in Melbourne, Victoria, Australia.

To stop by St Barbara’s website, CLICK HERE

About Genesis Minerals
Genesis Minerals Limited engages in the exploration and development of gold deposits in Western Australia. The company owns 100 percent interests in the Ulysses Gold project located to the north of Kalgoorlie. Genesis Minerals Limited was incorporated in 2007 and is based in West Perth, Australia.

To stop by Genesis Minerals’ website, CLICK HERE

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