Karora shareholders have been offered a multifaceted consideration for each share held. Credit: Salienko Evgenii/Shutterstock.

Westgold Resources and Karora Resources have completed their merger, establishing a new mid-tier gold production company.

The newly combined company, which has a market capitalisation of around $1.43bn, plans to have a dual listing on the Australian Securities Exchange (ASX) and Toronto Stock Exchange (TSX).

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The definitive arrangement agreement between the companies was signed in April 2024.

As per the deal, Westgold acquired all shares of Karora Resources.

Under the arrangement, Westgold offered Karora shareholders a multifaceted consideration for each share held.

This includes 2.524 Westgold shares, C$0.608 in cash and a 0.30 share in Culico Metals, a spin-off entity from Karora.

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Culico’s holdings include a 1% lithium royalty and rights to a deferred payment from the sale of the Dumont asset, alongside A$10.9m in cash.

Culico’s financial position is bolstered by A$5.36m received from Karora, equating to the value of Karora’s 22.1% stake in Kali Metals.

Due to regulatory constraints, Westgold has retained Karora’s 22.1% stake and compensated Culico with a cash equivalent.

Westgold managing director and CEO Wayne Bramwell said: “The merger with Karora upsizes our Western Australian operating platform – an extensive and established asset base that can be increasingly leveraged for free cash generation and growth.

“Westgold commences this new growth phase with a robust balance sheet and a plan focused on realising a potential A$281m (C$254m ) in corporate cost savings and A$209m in operating synergies.

“Together, as a combined entity, we are positioned to become a leading global mid-tier gold producer focused on building a long-term and sustainable business that consistently delivers value to our shareholders.”

Karora chairman and CEO Paul Huet said: “The combination of Karora and Westgold to create a new Westgold is a transformative step that will ensure growth continues as an unhedged gold producer in a historically robust gold market.”