Tamaya and Iberian merge

Tamaya Resources, previously SMC Gold, and Iberian Resources have agreed to merge by means of an off-market takeover offer by Tamaya for all the shares in Iberian. The new Tamaya will be an emerging mid-tier gold-copper mining company. Four Tamaya shares will be offered for each Iberian share in a transaction that values the merged entity company at A$270 million.

The offer will extend to all Iberian shares that come into existence during the offer period. Holders of Iberian options will receive private offers for their options. Iberian Resources possesses an outstanding portfolio of gold properties. This portfolio offers both the size and scale to add to the developing business the Tamaya board and new executive have successfully rebuilt in Chile. Matt Wood and Graeme Walker from the Iberian board will join the board of the new Tamaya after the completion of the transaction and the current Tamaya executive team will remain intact.

The rationale for the merger is grounded in the quality of the Litchkvaz-Tey gold project in Armenia, and the Montemor gold project in Portugal, which have a JORC-compliant portfolio of 2 Moz of gold equivalent. Iberian and Tamaya are highly complementary companies as they are both international explorers and operators focused on gold-copper minerals. Both companies are emerging and growing producers from copper operations in Chile and gold operations in Armenia. They are currently unhedged with no plans at present to hedge.

The merger will create an organisation with sovereign and commodity diversity. Iberian’s management has an outstanding project generation and exploration track record that neatly complements Tamaya’s project development and operational skills.

As Tamaya’s Cinabrio operations are optimized at the 1 Mt/y production level from early 2008 and start to produce a significant cashflow, it is expected that the financing requirement for the ramp-up of Iberian’s Armenian assets to be made easier, cheaper and less dilutive by the presence of cashflow in the company. This in turn will strengthen cashflows to support the development of the Montemor project in Portugal – so demonstrating the leverage of a wealth of opportunities in a project pipeline. The merger will mean that the new company has a firm foothold and outstanding land position in four of the world’s foremost metals belts: the Andean IOCG belt; the Tethyan belt; the Iberian pyrite belt; and the Charters Towers gold province.