Alkane Resources and Mandalay Resources merger
About the merger
On 5 August 2025, Alkane Resources and Mandalay Resources completed a merger of equals to create a combined company with producing assets in Australia and Sweden. Continuing under the name “Alkane Resources”, the combined company remains listed on the Australian Securities Exchange (ASX:ALK) and listed on the Toronto Stock Exchange (TSX:ALK) on 7 August 2025.
The transaction has created a diversified Australia-centric gold and antimony producer with a strong balance sheet founded on three operating mines:
- Tomingley – an open pit and underground gold mine in Central West New South Wales
- Costerfield – a gold and antimony underground mining operation in central Victoria
- Björkdal – an underground gold mine in Sweden.
The well-established and stable production from Costerfield and Björkdal complement the expanding production from Tomingley, which is currently ramping up after a major capital expansion.
As a mid-tier producer, the combined company is better positioned to pursue growth opportunities. Alkane Managing Director and Chief Executive Officer, Nic Earner, continues to lead the Australia-based executive team of the combined company, which has a new Board of Directors.
Creation of a gold & antimony producer
This merger of equals increases scale and benefits all shareholders
Diversified production of 160koz AuEq in 2025, growing to 180koz AuEq in 20261
- Two mines, Costerfield and Tomingley in Australia and one mine, Björkdal, in Sweden
- Diverse production from premier jurisdictions
Improved capital market positioning anticipated to drive valuation re-rate
- Expected valuation re-rate driven by GDXJ and ASX 300 index inclusion
- Further value uplift expected through greater trading liquidity driven and a more diversified shareholder base
Creates a powerful platform with a shared vision for growth
- Robust balance sheet: combined cash balance of A$188 / C$167million at 31 March 202522
- Continue to invest in organic growth through exploration at all three of its producing mines
- Large, long-life Boda-Kaiser copper-gold project adding further long-term growth
Merged leadership focused on delivering re-rate and driving growth
- Combined board with deep markets, operational and industry experience
- New independent Chair, Andy Quinn:highly credentialed banking and mining veteran with extensive gold industry experience
- Management led by Alkane’s Nic Earner: an experienced operator
- 2025 production estimate = Mandalay calendar year guidance from MND 17 December 2024 news release and Alkane fiscal year guidance from ALK Announcement 7 April 2025. 2026 production estimate = consensus broker analyst estimates for Mandalay (calendar year) and Alkane (fiscal year).
- Combined company will also have approximately A$60 million in debt from Alkane’s expansion of Tomingley in 2024/25. A$ to US$ exchange rate of 0.640 and C$ to US$ exchange rate of 0.722 per Bloomberg on 25 April 2025.
Benefits for shareholders
Benefits for Alkane shareholders
- Strengthened balance sheet with combined cash position of A$188m / C$167m at 31 March 20252
- Greater corporate scale with reduced risk from increased production and diversified revenue
- Exposure to highly strategic antimony revenue from Costerfield
- Anticipated increase in institutional investment from larger free-float and greater liquidity
- Well-capitalised platform to fund exploration, development and inorganic growth
- Highly credentialed, internationally experienced Board to deliver vision of building a leading mid-tier gold producer
Benefits for Mandalay shareholders
- Diversified production and cashflow in premier jurisdictions reduce overall risk
- Reduced shareholder concentration leading to increased float and liquidity
- Increased capital markets scale and liquidity unlocks value of passive and institutional investment
- Opportunity for valuation uplift from higher ASX-listed mining companies multiplies
- Exposure to growth via the highly prospective Boda-Kaiser copper-gold project
- Highly credentialed, internationally experienced Board to deliver vision of building a leading mid-tier gold producer
Summary of merger
Transaction structure
- Merger of Alkane and Mandalay via plan of arrangement under the Business Corporations Act (British Columbia) in an all-share transaction (the “Transaction”).
- Pro forma basic ownership 45% Alkane and 55% Mandalay shareholders.
Consideration
- Mandalay shareholders to receive 7.875 Alkane common shares per each Mandalay common share held (the “Exchange Ratio”).
- Implied market capitalization of A$1,013M / C$898M3.
Transaction approvals
- Mandalay shareholder approval with 66⅔% of votes cast.
- Alkane shareholder approval with 50% of votes cast.
- Customary regulatory, exchange and court approvals, including Australian FIRB and Swedish FDI approval and those of the ASX, TSX, and Canadian court (Supreme Court of British Columbia).
Other
- ASX as the primary and TSX proposed as a secondary listing.
- Mutual break-fee of A$17m of the Transaction value, payable under certain circumstances.
- Support agreements to vote in favour of the Transaction from all directors, senior management, and certain shareholders holding ~45% of Mandalay shares. Voting intention statements from certain Alkane Directors holding ~19% of Alkane shares.
Timing
- Mandalay and Alkane shareholder meetings occurred on 28 July 2025.
- Transaction closed on 5 August 2025.
- Based on an CADUSD of 0.722 and an AUDUSD of 0.640 per Bloomberg on 25 April 2025
For further information, please see the contacts below.
Alkane investor contact
Natalie Chapman, Corporate Communications Manager
+61 (0)418 642 556
natalie.chapman@alkres.com
Mandalay investor contact
Edison Nguyen, Director, Business Valuations and IR
+1 (647) 258 9722
e.nguyen@mandalayresources.com