Aeris Resources Ltd (ASX:AIS) has received overwhelming support from its shareholders for the acquisition of Round Oak Minerals Pty Ltd at the extraordinary general meeting (EGM) held today.
In April this year, the company entered a "transformational" agreement with Washington H Soul Pattinson and Company Ltd (WHSP) to acquire Round Oak for a total purchase consideration of $234 million.
This acquisition will transform Aeris into a diversified, mid-tier producer with a strong balance sheet to deliver an organic growth pipeline.
“Resounding endorsement”
Aeris’ executive chairman, Andre Labuschagne said: “Today’s strong support from our shareholders is a resounding endorsement of not only the Round Oak acquisition but also our clear strategy to grow Aeris into a mid-tier miner with long-life assets.
“The addition of the Jaguar, North Queensland and Stockman assets significantly diversifies our portfolio and increases our exposure to copper and zinc, both of which are considered 'future metals' and forecast to have increasing demand profiles in the decades ahead.
“We again thank shareholders for their support.”
Transaction consideration
Aeris has agreed to pay WHSP $234 million upon closing of the transaction, comprised of an $80 million cash payment and the issue of 1,466.7 million ordinary shares in Aeris at an issue price of $0.105 per share up to a total value of $154 million.
The acquisition of Round Oak will be on a debt-free basis and after the transaction, Aeris will have $16.9 million in cash.
In addition to the transaction consideration, WHSP is expected to receive total cash distributions of about $100 million from Round Oak in FY22 up until completion.
Capital raising
Aeris had completed a fully underwritten placement offer and institutional entitlement offer at $0.105 per new share for total funds raised of $74 million.
The company raised about $43.9 million through the institutional placement with approximately $30.1 million raised via the entitlement offer.
These funds will, in part, be used to fund the cash consideration for the acquisition of Round Oak Minerals and associated costs.