SYDNEY, AUSTRALIA: SensOre Ltd (ASX: S3N) has reached an agreement to acquire Intrepid Geophysics, a leading provider of geophysics software and services headquartered in Melbourne, Australia with distributors and resellers globally.

The deal will be primarily funded through the issue of new fully paid ordinary SensOre shares.

Intrepid Geophysics’ advanced automated geophysical software and geoscience expertise complement SensOre’s existing suite of machine learning and AI mineral exploration software products and technology offerings. Intrepid Geophysics’ large client base and strong cashflows were integral to SensOre’s strategic assessment of the transaction.

SensOre Chief Executive Officer, Richard Taylor said: “Acquiring Intrepid Geophysics is a major opportunity for us. Intrepid Geophysics’ deep geoscience and machine learning expertise in geophysics complements SensOre’s geochemistry and economic geology focus for targeting in mineral exploration. Demand for advanced geophysics software is strong and deployable globally. Intrepid Geophysics’ years of product leadership, data collation and collaboration with government geological surveys will benefit SensOre’s data platform development and client service offerings. We are looking forward to integrating Intrepid Geophysics’ exceptional talent with our team of innovators.”

Intrepid Geophysics Managing Director Dr Desmond Fitzgerald said: “The combination of SensOre and Intrepid Geophysics will unlock growth opportunities in a strong market for high level exploration targeting. We look forward to being part of a growing and exciting geoscience group.”

SensOre and Intrepid Geophysics completed a successful pilot project in Victoria in Q2 CY22, confirming the technological synergies and product complementarity between the two companies. The results of the pilot are expected to be deployed with clients in Q3 CY22, focussed on the highly prospective Stawell and Ballarat gold corridors. There is strong interest from prospective clients within these corridors.

Transaction Details

The agreement values Intrepid Geophysics at $5 million. Consideration for the acquisition involves:

• $3 million in SensOre stock at an issue price of $0.70 (4.3 million fully paid SensOre shares or 6.2% of SensOre on a fully diluted basis) to be issued at completion of the transaction (expected to be July 2022 subject to satisfactory completion of conditions precedent);

• A safeguards provision such that should the SensOre share price trade below the issue price for 12 months following the transaction a proportional adjustment of shares will be made up to a maximum of 4.3 million;

• $1 million in cash for a 100% ownership interest in Intrepid Geophysics (including ownership of Intrepid Geophysics’ extensive intellectual property and data repository) to be funded from existing cash balances (expected to be July 2022 subject to satisfactory completion of conditions precedent); and

• a further $1 million contingent cash payment on the one-year anniversary of the agreement subject to satisfactory completion of performance hurdles in relation to revenue generation and key personnel retention expected to be funded from cash balances, operating cash flows or capital raising in the next 12 months depending on the level of exploration activity and the revenue performance of SensOre during the 2023 financial year.