Greatland
Gold plc (AIM: GGP)
E: info@greatlandgold.com
W: https://greatlandgold.com
:
twitter.com/greatlandgold
NEWS RELEASE
| 4 December
2024
Completion of Transformational Acquisition of
Havieron & Telfer
THIS ANNOUNCEMENT CONTAINS
INSIDE INFORMATION AS STIPULATED UNDER THE UK MARKET ABUSE
REGULATIONS. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A
REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO
BE IN THE PUBLIC DOMAIN.
Greatland Gold plc (AIM:GGP) (Greatland or the Company) announced on 10 September 2024
that it had entered into a binding agreement with certain Newmont
Corporation subsidiaries (Newmont) to acquire Newmont's 70%
ownership interest in the Havieron gold-copper project
(Havieron), 100% ownership
of the Telfer gold-copper mine (Telfer), and other related interests in
assets in the Paterson region (together, the Target Assets), (the Acquisition).
Greatland is delighted to announce that completion of
the Acquisition (Completion) will occur in conjunction
and simultaneously with admission of the Consideration Shares
(defined and described below) to Newmont, and ownership and control
of the Target Assets will transfer to the Greatland group with
effect from 8:00 a.m. today, Wednesday 4 December 2024.
Greatland Managing Director, Shaun Day,
commented: "The closing of our
acquisition today is a watershed moment for
Greatland.
"Greatland's discovery of the world class Havieron orebody in
2018 established our platform for growth. Returning to 100%
ownership of Havieron now gives us the opportunity and control to
deliver the project's full potential. We have a defined
pathway for Havieron to become a low-cost long life gold-copper
asset of significant scale.
"Telfer is an iconic
Australian mine that immediately transforms Greatland into a
significant producer of gold and copper, with a defined mine plan that is materially
de-risked by substantial ore stockpiles, and significant mine life
extension prospects. Telfer production is expected to generate
significant free cash flow, which we expect will help to self-fund
the completion of Havieron's development.
"Combining Havieron
and Telfer under our single ownership provides the opportunity to
operate efficiently and deliver an exceptional platform for
continued growth and a compelling opportunity to create value for
our shareholders.
"This transaction was only possible with the support, time and
effort of many people and organisations. I would like to
thank our shareholders, both long-standing and new, who have
supported Greatland's remarkable journey and our funding of the
Acquisition. Newmont, our counterparty and now major
shareholder, has been highly constructive and collaborative in
reaching and completing our bilateral transaction. Our banking
syndicate of ANZ, HSBC and ING has supported Greatland for a number
of years as we have evolved from a developer to, now, a producer.
The exceptional efforts and achievements of our Greatland team,
both Board and management, cannot be overstated, and we are pleased
to be augmenting our team with an established Telfer
workforce.
"Finally, I would like to acknowledge our broader
stakeholders. Telfer is an established and important part of the
Paterson region and we understand our responsibility as its steward
going forward."
Transaction
highlights
The acquisition of Havieron and Telfer is a highly
accretive and strategically compelling transaction that has the
potential to deliver material value to Greatland's
shareholders.
Key highlights include:
§ Telfer production: Telfer is a
substantial operating gold-copper mine that is expected to generate
significant near-term cash flow. Greatland will benefit from
an estimated c.11.5Mt of run-of-mine ore stockpiles that have
already been mined, significantly de-risking and reducing the costs
of Greatland's initial Telfer production. A further estimated
c.20Mt of low grade stockpiles are also available.
An independently reviewed initial Telfer mine plan
was set out in the Competent Person's Report in Greatland's
Admission Document published on 10 September 2024, with total
estimated production of 426koz gold equivalent at an estimated AISC
of US$1,454/oz (net of by-product credits) over 15 months from the
restart of processing operations at Telfer (which occurred in late
September under Newmont's ownership). Greatland expects to
provide production and cost guidance for FY25 following its first
complete quarter of ownership and operation.
§ Telfer extension opportunities: In
parallel to executing the initial Telfer mine plan, a number of
additional potential Telfer ore sources have already been drill
tested and will be assessed with a view to extending the current
Telfer mine plan. Greatland will conduct a Telfer-wide review
of all mineralisation and stockpiles to produce an updated Telfer
Mineral Resource estimate in accordance with the JORC Code,
targeted to be completed in the March quarter 2025. Further
high priority mine life extension opportunities at Telfer will be
drill tested.
§ Havieron: Havieron is a world class
gold-copper project with a Mineral Resource estimate of 8.4Moz gold
equivalent metal content. The independently reviewed base
case (the Greatland Base
Case), set out in the Competent Person's Report in
Greatland's Admission Document published on 10 September 2024,
estimates a 2.8Mtpa mining operation with average annual production
of 258koz gold equivalent at a lowest quartile all-in sustaining
cost (AISC) globally of US$818/oz in steady state (first 15 years,
net of by-product credits), with a 20-year total mine life.
The Greatland Base Case will be refined and optimisation
opportunities will be assessed in a Feasibility Study targeted to
be completed by Greatland in H2 2025, including potential
mining throughput expansion and consideration of a bulk ore
handling solution.
§ Consolidation of mine, infrastructure and
control: Ownership of the Telfer infrastructure
substantially de-risks Havieron's development and provides
expansion optionality. With 100% ownership of the Target Assets,
Greatland has the opportunity to optimise and develop an integrated
Telfer-Havieron mining and processing operation.
§ Telfer workforce: Greatland is
delighted that 435 Telfer employees have accepted offers of
employment with Greatland, an acceptance rate of over 98%, securing
the transfer of a significant and highly skilled workforce, and
preserving the existing capability, expertise and knowledge to
enable continuity of efficient operations.
§ Funding and liquidity: Greatland has
entered into a A$100 million syndicated debt facility agreement
with its leading Australian and international banking syndicate of
ANZ, HSBC and ING, including a A$75 million revolving working
capital facility that matures on 1 December 2025. Together
with the equity funded working capital successfully raised for the
Acquisition, the facility provides important liquidity and
financial flexibility for Greatland's working capital requirements
for the operation of Telfer.
§ Clear pathway to fund Havieron
development: Greatland has a non-binding letter of support
for A$750 million in proposed banking facilities for the
development of Havieron, with ANZ, HSBC and ING Bank.
Combined with equity funded working capital and expected cash flow
generation from Telfer, Greatland expects there is a clear and
non-dilutive pathway to the Havieron development being fully
funded.
§ Arrangements with Newmont: Following
Completion, Newmont is Greatland's largest shareholder with 20.4%
of shares on issue. Newmont's shareholding is subject to an
initial 12 month voluntary lock-in, a further 12 month orderly
market arrangement, and a relationship agreement. Up to
US$100 million of the Acquisition cash consideration is deferred
until Havieron commences commercial production and subject to a
gold price hurdle. Realisation of any deferred cash consideration
is linked to a successful operational scenario, demonstrating
Newmont's support of Greatland's stewardship of Havieron and
Telfer.
§ Upside potential: Greatland considers
that there are significant upside opportunities as a result of the
Acquisition, including potential extension of the current Telfer
mine plan, optimisation of Havieron throughput potential and Telfer
processing capacity, supplementation of Havieron ore with Telfer
ore, and a potential regional 'hub & spoke' strategy enabled by
Telfer infrastructure.
Greatland's operating strategy is to renew and develop
an integrated Telfer-Havieron mining and processing operation, to
create a generational Australian gold-copper mining complex.
Further information about Greatland's operating strategy and
objectives is set out in the Company's Admission Document dated 10
September 2024 and Supplementary Admission Document dated 3
December 2024, both of which are available at https://greatlandgold.com/investors/results/.
As a significant Australian gold-copper producer and
developer, Greatland considers a listing on the Australian
Securities Exchange (ASX) to be a natural and compelling step for
the group. An ASX listing is targeted in the June quarter
2025, following which the group would be dual listed on both ASX
and AIM.
Transaction
consideration
Greatland agreed to acquire the Target Assets for
total consideration and debt repayment of up to US$475 million
(before adjustments).
Greatland has paid the following upfront
consideration upon Completion:
§ US$167.0 million
Acquisition consideration (after estimated purchase price
adjustments1); and
§ US$167.5 million in the
form of 2,669,182,291 Greatland ordinary shares issued to Newmont
(Consideration Shares),
representing 20.4% of Greatland shares on issue.
In addition, Greatland has made a US$52.4 million cash
repayment of the entire outstanding balance of the Havieron joint
venture loan, which has now been terminated.
Greatland expects to pay the following amounts to
Newmont on a deferred basis:
§ A$23 million in aggregate
estimated purchase price adjustments1 due 180 days after
Completion, for (i) ore mined and stockpiled between 1 October 2024
and Completion and acquired by Greatland at Completion; and
(ii) to compensate Newmont for running only one of the two
Telfer processing trains from 27 October 2024 until Completion
(thus preserving ore and stockpiles for Greatland to process after
Completion); and
§ Up to a maximum of US$100
million in deferred cash consideration which may be payable to
Newmont on the first five years' Havieron gold production, through
a 50% price upside participation by Newmont above a US$1,850/oz
hurdle gold price, subject to an annual cap of US$50 million and
aggregate cap of US$100 million.
1 Note on estimated
adjustments: Pursuant to the
Acquisition agreement, the amount of the purchase price adjustments
has been estimated for the purposes of the adjustments paid on
Completion. A final adjustment will be calculated and made
following the preparation and agreement of a final post-completion
statement, with the final adjustment expected to be agreed or
determined within six months.
Admission
As detailed in the Company's
Admission Document dated 10 September 2024 and Supplementary
Admission Document dated 3 December 2024, both of which are
available at https://greatlandgold.com/investors/results/,
the Consideration Shares have been issued to Newmont as partial
consideration for the Acquisition. The Acquisition
constituted a reverse takeover pursuant to the AIM Rules for
Companies. As such, trading in the
ordinary shares on AIM will be simultaneously cancelled and
readmitted (Admission) to trading at 8:00 a.m. on Wednesday, 4 December
2024.
Following Admission, the Company's
issued share capital comprises 13,079,294,602 ordinary shares each
with one voting right per share. There are no shares held in
treasury. When calculating the total number voting rights,
shareholders should use this figure as the denominator for the
calculations by which they will determine if they are required to
notify their interest in, or a change in their interest in, the
share capital of the Company under the Financial Conduct
Authority's Disclosure Guidance and Transparency Rules.
Contact
For further information, please
contact:
Greatland Gold plc
Shaun Day, Managing Director
| Rowan Krasnoff, Head of Business Development
info@greatlandgold.com
Nominated Advisor
SPARK Advisory Partners
Andrew Emmott / James Keeshan / Neil
Baldwin | +44 203 368 3550
Corporate Brokers
Canaccord Genuity |
James Asensio / George Grainger | +44 207 523
8000
Berenberg | Matthew
Armitt / Jennifer Lee | +44 203 368 3550
SI Capital Limited |
Nick Emerson / Sam Lomanto | +44 148 341
3500
Media Relations
UK - Gracechurch Group | Harry
Chathli / Alexis Gore / Henry Gamble | +44 204 582
3500
Australia - Fivemark Partners
| Michael Vaughan | +61 422 602 720
About Greatland
Greatland is a mining company focused on the
production, development and exploration of precious and base metals
in Western Australia. Greatland is listed on the London Stock
Exchange's AIM Market (LSE:GGP) and operates its business from its
headquarters in Subiaco, Western Australia.
Greatland discovered the world class Havieron
underground gold-copper deposit in 2018, in the Paterson Province
in the East Pilbara region of Western Australia.
On 4 December 2024, Greatland completed an
acquisition from Newmont that consolidated 100% ownership of Telfer
and Havieron, transforming Greatland into a new Australian
gold-copper producer of scale at Telfer, with a world class
development project in Havieron.
Greatland is targeting a dual listing on the ASX
in the June quarter 2025.