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Rox Resources Limited (“Rox” ASX:RXL) and its joint venture partner Venus Metals Corporation Limited (“Venus” ASX:VMC) are pleased to advise that they have entered into a binding agreement to consolidate their respective ownership interests in the Youanmi Gold Project in Western Australia.
Transaction Highlights
The parties have agreed that, subject to conditions precedent:
- Rox to acquire, for consideration of 110 million Rox shares:
- Venus’ interests in the OYG JV, giving Rox a 100% interest in OYG; and
- all of Venus’ gold interests in its other joint ventures covering other regional areas
- Venus’ interests in the OYG JV, giving Rox a 100% interest in OYG; and
- Venus to undertake an in-specie distribution of 55 million Rox shares to Venus shareholders, while retaining 55 million Rox shares, subject to 12 months voluntary escrow
- Venus Managing Director, Matthew Hogan, to be appointed to Rox’s Board
- Transaction simplifies the ownership structure for the Youanmi Gold Project, maximising value potential for Rox and Venus shareholders
Under the agreement, Rox will acquire Venus’ gold interests in each of its Youanmi joint ventures (30% of OYG JV (all minerals), 45% of Youanmi JV and Currans Find JV, and 50% of Venus Metals JV) (collectively the “Youanmi Gold Project”) for consideration of 110 million fully paid ordinary shares in Rox (“Rox Shares”) (“the Transaction”), subject to the conditions precedent (as summarised below) being met. Venus will retain its non- gold interests in the Youanmi JV, Currans Find JV and Venus Metals JV, as well as its interests in its non- Youanmi gold assets.
The Transaction will see all gold rights held by Rox and Venus consolidated under a simplified, single ownership structure, providing a strong platform to progress the development of the Youanmi Gold Project.
Venus shareholders will, following completion of the Transaction, have the opportunity to benefit from the Transaction through:
- Eligible Venus shareholders (as at a record date to be advised) receiving Rox Shares through Venus proposed in-specie distribution of Rox Shares; and
- Retaining their Venus shares, and therefore, retaining an indirect interest in the Rox Shares retained by Venus and continue to participate in the value of Venus’ non-Youanmi assets (which include gold, lithium, base metals and rare earths projects).
By simplifying the ownership structure, streamlining the development decision making process and increasing scale and market relevance, the parties believe that this structure will provide Rox with greater market appeal and access to capital, which is expected to unlock value for both Rox and Venus shareholders.
Management Comments
Rox Resources Managing Director, Mr Rob Ryan commented:
“Consolidating the gold interests under the Youanmi Gold Project under Rox’s ownership is a logical transaction that is expected to deliver compelling value for both sets of shareholders and we are enormously excited about the strong foundation this transaction creates for the Project’s ongoing exploration and development. The transaction provides investors and financiers with a clearer ownership structure and access to the full value of the Youanmi Gold Project.
“Building on our existing high-grade resource base and our recent exploration success at Midway and Youanmi South, this simplified ownership structure will enable Rox and Venus shareholders to share in the future growth of Rox as we work to unlock the full potential of the Youanmi Gold Project.”
“2023 is set to be a milestone year at Youanmi, with drilling underway to convert existing Inferred Resources to Indicated status to support the Pre-Feasibility Studies. We are also very excited to see ongoing results from the Midway and Youanmi South discoveries, which are potential gamechangers for the Youanmi Gold Project.”
Venus Managing Director, Mr Matthew Hogan, commented:
“This is a win-win transaction for all shareholders in both companies, unlocking considerable value and dramatically simplifying the development pathway for the Youanmi Gold Project.
I’m extremely confident in the capabilities of the Rox Board and Management team, and very excited to be joining forces with them with the aim of bringing the Youanmi Gold Mine back into production in the near future.”
Pictured above, Rox Managing Director, Mr Rob Ryan and Venus Managing Director, Mr Matthew Hogan.
Transaction Rationale
Both the Rox and Venus Boards consider there to be strong strategic rationale for the Transaction. Venus shareholders will retain their exposure to the Youanmi Gold Project both as Rox and Venus shareholders, while also allowing the market to fully recognise the value of the remaining assets held by Venus.
Click here for the full ASX Release
This article includes content from Venus Metals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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