ASX-listed companies Regis Resources and Vault Minerals have agreed to merge as equals through a Vault scheme of arrangement, under which Regis will acquire 100% of the fully paid ordinary shares in Vault.

Under the scheme, Vault shareholders will receive 0.6947 new fully paid ordinary shares in Regis for each Vault share held.

Upon implementation of the scheme, Regis shareholders will own about 51% and Vault shareholders will own about 49% of the combined company.

The merger creates Australia’s next major gold producer with a globally significant gold production of 700 000 oz/y across five high-quality operating assets across Western Australia; a strong debt-free balance sheet and significant cash generation to fund the next phase of growth; and a large mineral endowment of six-million ounces of reserves and 20.5-million ounces of resources.

The merger offers both companies diversificiation to its portfolio, scale and enhanced operational resilience, as well as the ability to realise cost efficiencies of more than A$500-million, including in corporate tax and through lower cost of capital.

The combined entity will be led by Russell Clark as nonexecutive chairperson and Regis CEO Jim Beyer as MD and CEO. The combined company’s board will comprise of four directors from each of the current Regis and Vault boards.

Beyer says the merger creates Australia’s third-largest primary ASX-listed gold producer, which demands global recognition.

Beyer and Vault CEO Luke Tonkin agree that the transaction represents a compelling opportunity for shareholders to retain meaningful ownership and governance influence while gaining exposure to a larger, more resilient gold company with enhanced scale, diversification and balance sheet strength.

They echo the view that the merger company will be better positioned to deliver sustained production, enhanced reserve replacement and long-term value creation across gold price cycles.

The merger is expected to be effective around August or September this year.