Southern Cross Gold signed a non-binding term sheet with Canada's Mawson Gold.

The agreement will merge the two companies under an Australian scheme of arrangement, resulting in a dual-listed entity on both the ASX and the TSX Venture Exchange.

"The simpler, dual-listed structure will allow us to achieve the following core objectives: access to broader capital markets and institutional/private investors; elimination of a perceived major shareholder overhang; and attract an expected lower cost of equity capital which will allow the Sunday Creek Project to continue its path to development," said Tom Eadie, Southern Cross Gold's non-executive chairman.

The new entity will operate under the name Southern Cross Gold, with an approximate 50.4% ownership distribution to current SXG shareholders.