Aureka Ltd. is set to step into gold production in Victoria after securing a binding agreement to acquire High Grade Holdings (HGH), owner of the operating Fiddlers Creek underground mine and the Wedderburn gold processing mill.
The AU$8.9 million majority-scrip transaction elevates Aureka to Victoria’s newest listed gold producer. It expands the company’s portfolio, which already hosts an estimated 455,000 ounces of Inferred JORC mineral resources across its central Victorian tenure, by pairing its development assets with immediate processing capabilities.
Under the deal, Aureka will acquire 100 per cent of HGH for AU$2.5 million in cash and AU$6.4 million in Aureka shares priced at 12 cents each, alongside AU$500,000 in rehabilitation bond reimbursements. Up to AU$2 million in contingent milestone payments may also apply over three years.
To fund the acquisition, Aureka raised AU$5.65 million through a two-tranche placement. A matching share purchase plan (SPP) will allow eligible shareholders to participate at the same 12 cents share price, aiming to raise up to an additional AU$1.5 million.
The centrepiece of the deal is the Wedderburn Mill, one of only six licensed gold processing facilities in Victoria. Featuring gravity and flotation circuits with stated spare capacity, the facility is permitted for third-party toll treatment and sits within 50 kilometres of Aureka’s Comstock Gold Project.
Ownership of the mill could allow Aureka to not only unlock commercial pathways for its projects but also retain processing margins that would otherwise be paid to third-parties.
“It is great to have agreed to a transaction that would step Aureka into production in a controlled and measured way in Victoria, with ownership of a licensed mill,” said James Gurry, Aureka’s Managing Director.
“The strategic fit is abundantly clear… Aureka has a large and growing Victorian gold portfolio, including the scale potential of Irvine in the multi-million-ounce Stawell Corridor and the brownfield opportunity Comstock at St Arnaud, but up to this point – we did not own a processing facility.”
Completion remains subject to customary conditions precedent, including Aureka shareholder approval at a meeting to be held on October.
The company is aiming to complete the deal as soon as possible after the shareholder meeting.
