Genesis Minerals, Vault Minerals merge in $12.6B gold deal

• Genesis Minerals (ASX:GMD) has entered a binding agreement to acquire Vault Minerals (ASX:VAU) to create a $12.6 billion gold miner.
• The transaction values Vault Minerals at approximately $5.6 billion, with Vault shareholders receiving Genesis shares plus cash.
• The company stated that the combined entity expects to produce 600,000 to 700,000 ounces of gold per year across Western Australia.

Genesis Minerals (ASX:GMD) has agreed to acquire Vault Minerals (ASX:VAU) via a binding scheme of arrangement to form a combined gold producer with a pro-forma market capitalisation of $12.6 billion.

The $5.6 billion transaction comes after a sector-wide correction reset valuation expectations across the gold mining industry.

“This transaction represents a truly logical combination of assets to create the third-largest Australian gold producer and represents a genuine win-win for all shareholders,” said Genesis Minerals Executive Chair Raleigh Finlayson.

Under the terms of the deal, Vault shareholders will receive 0.7629 new Genesis shares and $0.475 in cash for each Vault share held.

Genesis stated that the merged group is expected to achieve post-tax synergies of approximately $2 billion over time, with implementation targeted for November.

Following the announcement, the Genesis Minerals share price was up at $6.00.

Genesis Minerals operates primary exploration and gold production assets centred around the Leonora and Laverton regions in Western Australia.

The combined portfolio contains pro-forma mineral resources of 33.6 million ounces and ore reserves of 9.4 million ounces of gold.