Coda Minerals to acquire all ordinary share of Torrens Mining

SYDNEY, AUSTRALIA: Coda Minerals Limited (ASX: COD) and Torrens Mining Limited (ASX: TRN) have entered into a Bid Implementation Deed (BID), for a recommended conditional off-market takeover offer, pursuant to which Coda will offer to acquire all the issued ordinary shares of Torrens.

The Board of Directors of Torrens unanimously recommend that Torrens’ shareholders accept the Offer, in the absence of a superior proposal, a bourse filing said.

Under the Offer, Torrens’ shareholders will receive 0.23 Coda shares for every 1 Torrens share held.

The Offer values the Torrens shares at $0.202 each3 or approximately $23.2 million4 equity value and delivers Torrens shareholders a:

• 30% premium to Torrens closing price of $0.155 on 8 February 2022;

• 30% premium to 10-day VWAP of $0.1562; and

• 35% premium to 20-day VWAP of $0.1502.

The Offer delivers a substantial premium to Torrens’ shareholders, who will retain ~21.2% ownership and participation in the future performance of Coda, subject to the Offer being successful. Moreover, Torrens shareholders are expected to benefit from the higher liquidity of Coda shares.

Transaction Strategic Rationale

The Offer, if successful, is expected to result in Coda consolidating 100% ownership of the Elizabeth Creek Copper Project via the acquisition of Torrens’ current 30% joint venture interest and provides an attractive investment proposition for existing and new shareholders.

Key benefits of the transaction include:

• 100% ownership consolidation of Elizabeth Creek into a single entity to provide full exploration optionality and deliver management and cost synergies;

• Creating a company with increased scale, market relevance, funding capability and trading liquidity; and

• Strong board, management and technical team with a proven exploration track record.

In addition, post the Offer being fully implemented, Coda is expected to have an implied market capitalisation of approximately $109 million5 (prior to any re-rate) and the nature of the all-scrip consideration of the Offer preserves Coda’s strong balance sheet which has current cash of $14 million (as at 31 December 2021).

Chief Executive Officer of Coda, Chris Stevens, commented: “The combination with Torrens provides a compelling opportunity to create value for both sets of shareholders by unlocking important synergies in the exploration and development of our core asset, the Elizabeth Creek Copper Project in South Australia.

The Offer provides an immediate premium of over 30%, while the consolidation of 100% ownership of Elizabeth Creek in a single company represents a logical and very positive next step in the project’s evolution.

“We look forward to welcoming Torrens shareholders to Coda’s register and for them to continue to benefit from further progress at Elizabeth Creek as we continue to progress the project through the next exciting phase of exploration and development in 2022.”

Managing Director of Torrens, Steve Shedden, commented: “Torrens acquired the Elizabeth Creek Project in 2015, brought Coda into the Project in 2017 via a farm-in-joint venture. Now in 2022, we are pleased that in addition to realising an attractive premium, the transaction provides Torrens’ shareholders with the opportunity to become shareholders of a company with significantly increased scale and a clear focus on the Elizabeth Creek Copper Project.

“By accepting the Offer, Torrens’ shareholders will continue to have a material interest in the upside associated with Elizabeth Creek, while at the same time mitigating funding risks and gaining exposure to a more diversified exploration portfolio.

Torrens’ shareholders will retain exposure to the company’s existing gold assets in Victoria and NSW and its tenement applications in Papua New Guinea, while benefiting from Coda’s strong balance sheet and also gaining exposure to its recently acquired Cameron River copper-gold project in the Mt Isa district of North Queensland.

“Torrens’ Board believes that this transaction is in the best interests of Torrens and unanimously recommends it to our shareholders, in the absence of a superior proposal.”

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