Unity Mining boss Andrew McIlwain has kept his pledge to launch a merger or acquisition before Christmas, with the Melbourne-based company today merging with fellow gold play Cortona Resources.
The two Australian gold miners announced plans to merge this morning with Cortona shareholders to get 0.734 Unity shares for each Cortona share they hold.
Shares in Unity were a cent higher to 14 cents shortly after 11am, while Cortona shares were also about one cent higher at just over 9 cents per share.
The plan to create a single company with a $90 million market capitalisation would give Cortona shareholders instant exposure to the gold price, which is rising toward $US1800 per ounce on the back of renewed stimulus measures in the United States.
Unity already produces about 50,000 ounces per year from its Henty mine in Tasmania, and has been looking for exposure to a second asset for some time.
That asset will now be the Dargues Reef deposit, which Cortona has been developing for several years.
Located about 60 kilometres from Canberra, Dargues Reef is in a historic gold mining region but has more recently been dominated by agriculture, forcing Cortona to navigate an arduous approvals process through planning and environment regulators.
Unity boss Andrew McIlwain said all approvals were now in place, meaning that Dargues Reef was ready for someone to spend money on it.
"We just had to add water in the form of equity and it's up and away," he said.
Mr McIlwain told Businessday in June that Unity had quarantined $48 million for growth opportunities and wanted to get something done before Christmas.
The benchmark gold price was just below $US1779 per ounce overnight, and is tipped to test record levels around $US1900 per ounce in coming months.