Maximus Resources Ltd directors have unanimously recommended that shareholders accept the offer by Astral Resources NL of one Astral share for every two Maximus shares they hold.
This implies an offer value of approximately $0.073 per Maximus share, based on the 5-day VWAP of Astral shares of $0.145 prior to the announcement of the offer on February 3, 2025.
The offer is scheduled to close at 7.00pm (AEDT) on Friday, March 7, 2025, unless extended or withdrawn and as of February 17, Astral held a relevant interest in 198,803,424 Maximus shares for 46.36%.
Directors accept
All of the Maximus directors have decided to accept the offer with respect to their own shares and those they control in the absence of a superior proposal.
Collectively, the Maximus directors own or control approximately 5.1 million Maximus shares, representing approximately 1.20% of all shares on issue.
Compelling premiums
The implied value of $0.073 per Maximus share provides Maximus shareholders with the ability to receive compelling premiums, specifically:
- 61% premium to Maximus shares’ last undisturbed closing price of $0.045 on December 24, 2024;
- 67% premium to Maximus shares’ 30-day volume weighted average share price of $0.043 up to and including December 24, 2024;
- 48% premium to Maximus shares’ 12-month closing share price high of $0.049 (up to and including December 24, 2024);
- 175% premium to Maximus shares’ 12-month closing share price low of $0.026 (up to and including December 24, 2024); and
- $93/ounce resource acquisition price, based on the current Maximus published JORC-compliant mineral resource estimate.
Reasons for decision
In a Target’s Statement non-executive chairman Martin Janes outlined the following reasons for the decision of directors:
Attractive premium - The implied $0.073 value of the offer represents an attractive premium for Maximus shareholders.
Value per ounce - The offer recognises a value of $93/ounce for the current Maximus’ published JORC-compliant mineral resource estimate that was not historically reflected in the share price.
Exposure to larger diversified portfolio of quality gold assets and re-rate potential - The offer provides Maximus shareholders access to Astral’s Mandilla Gold Project, which is one of the largest undeveloped single-pit gold deposits in Western Australia (1.27 million ounces) being advanced through preliminary feasibility studies.
The combined portfolio brings together Mandilla with Maximus’ nearby deposits, mining leases and tenure footprint, creating a more flexible pathway for the development of the proposed Mandilla processing plant and establishing a development pathway for Maximus’ gold resources and potential future ore feed from regional exploration targets.
The combined entity will have a pro forma market capitalisation of around $205 million, a combined (and proximal) mineral resource of approximately 1.8 million ounces of gold and regional gold targets underpinning significant exploration potential.
Decrease in funding risks for Maximus shareholders - As an investor in greenfield exploration and brownfield investments, Maximus is not currently generating cash flow. Future funding would require raising equity and debt or selling existing assets (or diluting project interest) to realise near-term commercialisation of the assets.
Astral’s strong cash position of approximately $25.2 million as of December 31, 2024, reduces the near-term capital raising requirements. Astral has a strong institutional investor base, which underpinned Astral’s successful $25 million equity capital raise in September 2024.
No superior proposal - As of the date of the Target’s Statement, no superior proposal has emerged. Since the announcement of the offer, no superior proposal has emerged that would cause the Maximus’ directors to reconsider their recommendation. The Astral offer is currently the only corporate control proposal that is capable of being put to Maximus shareholders.
Given Astral's relevant interest in 46.36% of Maximus’ shares, this may reduce the likelihood of a third party putting forward a superior proposal.