Westgold and Karora Finalize Merger to Form Leading Mid-Tier Gold Producer

Merger Completion

Westgold Resources Limited (ASX: WGX; OTCQX: WGXRF) and Karora Resources Inc. (TSX: KRR; OTCQX: KRRGF) have announced the completion of their merger, creating a leading mid-tier gold producer. The new entity is expected to be dual listed on the Australian Securities Exchange (ASX) and Toronto Stock Exchange (TSX).

Westgold has acquired 100% of the issued and outstanding shares of Karora by way of a statutory plan of arrangement under the Canada Business Corporations Act. This merger creates a larger, more diversified gold company with a robust balance sheet and a strong pipeline of organic opportunities.

Key Benefits

The merger establishes a top five Australian gold producer with a pro forma market capitalization of A$2.5 billion. The combined entity will be one of the largest unhedged Australian gold producers, providing investors with full exposure to the gold price. Additionally, the merger enhances the capital markets profile of the company, increasing scale, trading liquidity, and potential index inclusion for investors across ASX, TSX, and OTCQX.

The new entity will benefit from an expanded team, quality operating assets, and significant corporate cost savings and operating synergies. Westgold's Managing Director and CEO, Wayne Bramwell, highlighted the potential A$281 million in corporate cost savings and A$209 million in operating synergies as key advantages of the merger.

Management and Board

The Westgold Board will continue to be chaired by the Hon. Cheryl Edwardes AM, with other incumbent members remaining in their roles. In connection with the merger, Karora's Managing Director, Australia, Leigh Junk, and Karora Director Shirley In’t Veld have been appointed to Westgold's Board. Karora's Chair and CEO, Paul Huet, will continue with Westgold in a special advisory role for six months.

Shareholder Information

Under the terms of the arrangement, each former shareholder of Karora is entitled to receive 2.524 Westgold fully paid ordinary shares, C$0.608 in cash, and 0.30 of a share of Culico Metals Inc., a new company spun out from Karora, for each Karora share held immediately prior to the effective time of the arrangement. Culico's assets include a 1% lithium royalty on certain mining interests held by Kali Metals Limited and A$10.9 million in cash.

The Westgold shares are listed for trading on the ASX and, subject to final approval of the TSX, will commence trading on the TSX under the ticker symbol WGX at market open on 6 August 2024. Karora has applied to de-list its shares from the TSX, with delisting expected to be effective at market close on 2 August 2024.