Recommended Takeover of Mako Gold by Aurum Resources

Aurum Resources Limited (ASX: AUE) (“Aurum”) and Mako Gold Limited (ASX: MKG) (“Mako”) are pleased to announce that they have reached an agreement to merge to create a well-funded, stand-out emerging exploration and development gold business in West Africa.

• Mako Gold Limited (ASX:MKG) and Aurum Resources Limited (ASX:AUE) have entered into a Bid Implementation Agreement (BIA), for an agreed merger pursuant to which Aurum proposes to acquire 100% of the issued shares in Mako and 100% of two classes of unlisted options by way of an off-market takeover bid (Proposed Merger)
• Proposed Merger will create an emerging exploration and development gold business in West Africa, with cash of over A$20 million1 to advance the flagship Napié and Boundiali Projects in northern Côte d'Ivoire
• Aurum to offer:
  • 1 Aurum share for every 25.1 Mako shares, representing an offer price of $0.018 per Mako share2 (Share Offer)
  • 1 Aurum share for every 170 Class A Options3
  • 1 Aurum share for every 248 Class B Options4 (together, the Option Offers)
• Offer represents a 112% premium for Mako shareholders based on the 30-day VWAP of A$0.008555
• Mako shareholders will own 20.5% of the merged entity under the Share Offer while Aurum shareholders will own the remaining 79.5%6
• Mako Directors unanimously recommend that, in the absence of a superior proposal, all shareholders and option holders accept Aurum’s offers7
• The combined group will be pursuing its growth strategy from a position of greater market scale, underpinned by a strong cash balance of $20 million8 and lower consolidated cost base
• Aurum has 6 company-owned drill rigs operating at its Boundiali Project and has ordered two new diamond drill rigs to deploy following completion of the Proposed Merger

Recommended Takeover Offer for Mako

The companies have executed a Bid Implementation Agreement (the “BIA”) to effect the merger by way of off-market takeover bids (the “Offers”) under which Aurum will bid for 100% of the shares and 100% of the Class A Options and Class B Options in Mako (“Proposed Merger”).9

The Proposed Merger will allow both Aurum and Mako securityholders to benefit from the combination of Aurum’s strong balance sheet and exceptional drilling efficiencies, with A$20 million in cash to deploy into rapid work programs targeted at further resource definition across Aurum and Mako’s assets in northern Côte d'Ivoire.

The merged company will be driven by a highly experienced Board and Management team with extensive gold experience from grass roots discovery, through to resource drill-out, feasibility studies, project finance and production.

Commenting on the proposed merger, Aurum Managing Director Dr Caigen Wang said:

“The Aurum team is excited to apply our skills to the Napié Project, which we consider has great potential to quickly evolve into a multi-million ounce project with a dedicated owner-operated multi-rig drilling programme which can be delivered at a cost significantly below standard contract rates.”

“We see strong similarities between Napié and the Abujar Project where the Aurum executive team, when running Tietto Minerals Ltd, were able to rapidly grow resources to 3.8Moz, and propel Abujar into production before being acquired in mid-2024 for over A$768 million.”

“We look forward to collaborating with the strong Mako technical team to marry their exploration skills with our exploration and cost efficiencies to drive benefits for all of our shareholders. Between driving growth at Napié and being well on the path to delivery of a maiden resource at our own Boundiali Project later this year, we see strong potential for Aurum to become a strong emerging gold developer in Côte d’Ivoire with two assets with long-life potential in close proximity to each other.”

Commenting on the proposed merger, Mako Managing Director Peter Ledwidge said:

“We are pleased to agree this deal with the highly capable team at Aurum. The Aurum executive team have a demonstrable track record of being able to rapidly and very cost effectively drill-out resources using their owner-operator model.”

“We have always believed our Napié Project has potential to host multi-million ounces of gold, and pleasingly, due to relative sizes of Mako and Aurum, upon close of the Proposed Merger, Mako securityholders will remain a meaningful part of the expanded group, and therefore will share in the continued upside to the growth in Napié, as well as gain exposure to the rapidly evolving Boundiali Project where Aurum expects to deliver its maiden resource in late 2024.”

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