PERTH: CZR Resources Ltd. announced Friday a recommended off-market takeover bid for Zuleika Gold Ltd., valuing the gold exploration company at approximately $44.8 million in a merger designed to create a diversified Western Australian mining group.
Under the deal announced June 26, Zuleika shareholders will receive 0.1742 CZR shares for each Zuleika share held. The offer price of $0.0427 per Zuleika share represents a 32.9% premium to the reference price period and a 26.6% premium based on the 30-day volume-weighted average prices of both companies through June 25.
The combined entity will bring together CZR’s advanced Croydon exploration asset and Zuleika’s highly prospective Zuleika Shear projects, both located in Western Australia. Company officials said the merger would enhance operational capabilities across exploration, development and mining while reducing corporate costs.
“This opportunity sets a platform for future aggressive growth for exploration, development and accretive acquisition with an immediate targeted focus on the strategically significant Zuleika Shear,” the Zuleika board said in a statement.
The independent boards of both companies have unanimously recommended the transaction. Zuleika board members, who collectively own or control approximately 9.95% of Zuleika shares, have indicated they intend to accept the offer.
CZR’s independent board members, who control about 0.016% of CZR shares, have confirmed they will vote in favor of the transaction at a shareholder meeting scheduled for Sept. 18.
The offer is subject to several conditions, including CZR securing at least 90% of Zuleika shares and acquiring a minimum of 75% under the offer. The deal also requires shareholder approval under ASX Listing Rule 10.1 due to the interests of Yandal Investments Pty Ltd., CZR’s controlling shareholder, and Annie Guo, a director of both companies.
All Zuleika options must be exercised or exchanged for equivalent CZR options, and all performance rights must convert to shares before finalization.
The Bidder’s Statement and Target’s Statement are expected to be dispatched to shareholders in August, with the offer opening Aug. 19 and closing Sept. 28 unless extended.
CZR is being advised by Thomsons as legal counsel, while Zuleika is advised by Steinepreis Paganin.
“Access to the highly prospective Zuleika Shear assets will augment CZR’s exciting exploration portfolio including the advanced Croydon project,” the CZR board said.
The merger will combine the companies’ balance sheets and cash reserves, providing financial flexibility to fund existing projects and pursue new acquisition opportunities, officials said.
The announcement contains forward-looking statements, and companies cautioned that actual results may vary materially from projections.
