Saracen Mineral has entered a bid implementation deed to acquire all of the shares of Australian gold exploration company Bligh Resources for A$38.2m ($26m).

Bligh Resources’ only project Bundarra is located less than 30km south of Saracen’s Thunderbox project and comprises five mining leases and six prospecting licences that host four known gold deposits.

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The project has JORC-compliant resources of 9.7Mt at a grade of 2.1g/t for a total of 660,000oz of gold.

At the Bundarra Gold Project, which is at an advanced stage of exploration, three open pit mines were developed in the early 2000s.

The company has reported mineral resources (JORC 2012) across three deposits at the Celtic, Wonder North, Wonder West and a new exploration zone the Bluebush.

Saracen Mineral managing director Raleigh Finlayson said: “The offer makes sense for both companies. Saracen’s infrastructure at our nearby Thunderbox operations means we can unlock the value of Bundarra and this is reflected in the share price premium we have offered to Bligh shareholders.”

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Bligh Resources shareholder Zeta Resources has indicated that it intends to accept the offer in absence of a superior proposal.

Under the deal, Bligh Resources shareholders will be issued 0.0369 Saracen shares for every Bligh share held.

The offer is subject to a number of conditions, which include a 90% minimum acceptance by shareholders of Bligh Resources, no breach by the company of the conduct of business restrictions or its warranties in the bid, among others.

During the offer period, Saracen may also provide a working capital facility of up to A$100,000 to Bligh Resources.

Saracen said that the offer consideration is final and will not be increased.