Jurisdiction - Australia
Ashurst Advises On Merger Of Sirius And IGO.

26 May, 2015


Ashurst has advised Sirius Resources NL (Sirius) on its AUD 1.8bn acquisition by Independence Group NL (IGO). The IGO/Sirius MergeCo is valued at AUD 2.7bn.


Sirius and IGO have entered into a scheme implementation deed pursuant to which IGO will acquire all the issued capital of Sirius by way of an acquisition scheme of arrangement (Acquisition Scheme).


In addition, Sirius will undertake a demerger of its Polar Bear and Scandinavian assets, including the recently discovered Baloo gold deposit (Demerger), via a demerger scheme of arrangement (Demerger Scheme), effected by a capital reduction. The new listed vehicle that will hold the demerged assets is called S2 Resources Ltd (S2). S2 will receive AUD 20m for working capital purposes as part of the Demerger, and will be led by Sirius’ founding Managing Director, Mark Bennett.


The Acquisition Scheme values Sirius at AUD 1.8bn, with the IGO/Sirius MergeCo valued at AUD 2.7bn. This represents a 46% premium to Sirius’ one-month volume weighted average price. Shareholders will also benefit from the growth potential of Sirius’ world-class Nova-Bollinger nickel/copper development project, which is fully financed, currently under construction and remains on track to be generating significant cash flow from 2017.


Ashurst lead partner on the matter, Roger Davies said: “We are delighted to have advised Sirius Resources in relation to this significant transaction. This represents the culmination of Sirius’ strategy in relation to its world-class Nova-Bollinger project, and we have previously advised Sirius on a number of aspects of this strategy, including the acquisition of the balance of the interest in the Nova-Bollinger project in early 2014, the subsequent A$UD 89m capital raising to finance development of the project and the finalisation of its native title agreements.


“It has been a pleasure to again assist Sirius with such a complex and transformational deal, which used a novel transaction structure to achieve the desired commercial outcomes and maximise shareholder value.”


As part of the transaction, Sirius shareholders will receive 0.66 IGO shares and AUD 0.52 cash per Sirius share, and circa 1 S2 share for every 2.5 Sirius shares held.


The Ashurst team advising on the transaction included partner Roger Davies and Adam Conway.


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