Under the terms of the merger Deep Yellow will acquire 100% of the Vimy shares on issue. Vimy shareholders will receive 0.294 Deep Yellow shares for every Vimy share held on the scheme record date.
Upon implementation of the scheme, Deep Yellow shareholders will hold 53% of the Merged Group and Vimy shareholders will hold 47%.
The merged group is estimated to have a market capitalisation of approximately AUD658m ($494m, €446m), cash and equivalents of approximately AUD106m and no balance sheet debt.
In addition to numerous exploration assets, both companies have advanced development projects in their portfolios: Vimy Resources owns the Mulga Rock uranium project in Western Australia, for which the company has completed a definitive feasibility study; while Deep Yellow owns the advanced Tumas uranium project in Namibia, with a definitive feasibility study on track for completion by the end of 2022.
The new company will have one of the largest uranium mineral resource inventories globally at 389 million pounds U3O8 (14,963 tU).
John Borshoff, managing director and chief executive officer of Deep Yellow, said the merger combines two world class assets, both in Tier-1 mining jurisdictions, into a single group with scale and knowhow. “The expanded strong technical team of Deep Yellow, together with Vimy personnel, positions us well to bring both projects online when uranium prices support the generation of long-term, sustainable positive cash flows,” he said.
He added the transaction also creates a platform for additional acquisitions.