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Vault Minerals (ASX:VAU) has suddenly found itself in the middle of an emerging bidding war, with Genesis Minerals (ASX:GMD) lobbing a $5.6 billion offer at the gold miner that trumps the original merger deal between Vault and Regis Resources (ASX:REG), which had been drawn up back in May.
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The unsolicited binding merger proposal from Genesis came out of the blue for Vault, but was quickly deemed “superior” in an update to shareholders.
Vault has already flagged that with Regis, who now has five business days to at least match the offer, if not come back with a bigger treasure chest. Regis’ proposed merger in May had priced the explorer at closer to $4.5 billion.
It’s fairly interesting because a Vault–Genesis union in Leonora and Laverton has been hypothesised for some years now; it shocked some in the gold mining sector when it was actually Regis that approached first. The Financial Review even tipped Genesis to eventually join the bidding battle at some stage.
Should this Genesis offer go through, the pair would wield ~700,000 ounces of annual production, 35M ounces in resources, and over 9M ounces of reserves concentrated within one of Australia’s premier gold provinces.
It also makes sense in a physical sense, with Vault’s King of the Hills open pit currently operating a short distance from several Genesis deposits.
The market obviously likes the idea on the explorer side, with VAU shares booming nearly +10% at open after the offer was unveiled. GMD, meanwhile, dropped nearly -7%, though that loss is under the -10% that RRL lost in May when it announced that it was making a move for the smaller WA company.
This morning, Regis has headed nearly +2% higher.
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