Regis Resources has opted to walk away from its bid for Vault Minerals, choosing not to match competing takeover bid from Genesis Minerals.
The decision clears the way for Genesis to secure the acquisition, while Regis walks away with a substantial break fee.
Regis said its board had determined that matching the Genesis proposal would not meet the strict value and return thresholds it applies to growth projects.
Maintaining this capital discipline, the company stated, remains fundamental to protecting long-term shareholder value.
Regis and Vault had agreed in May to an all-stock merger that valued Vault at AU$4.61 per share. That offer was trumped by a bid from Genesis that valued Vault at AU$5.27 per share.
Vault directors found the bid superior to the Regis deal. The fallout from the decision will see Vault terminate its existing scheme implementation Ddeed (SID) with Regis.
Under the terms of that initial agreement, the termination triggers a hefty break fee of approximately AU$50.7 million payable directly to Regis.
Despite missing out on Vault, Regis emphasised its robust financial position. The company remains debt-free, boasting a stellar balance sheet with AU$1.2 billion in cash and bullion.
It also highlighted its strong organic growth pipeline, including the recently updated Ore Reserves at its McPhillamys gold project, following a completed pre-feasibility study.
Meanwhile, Vault confirmed it intends to formally terminate the Regis SID as soon as the matching right period officially expires later today. Vault’s board was legally blocked from entering a binding deal with the rival bidder until the matching period concluded.
Genesis has confirmed its proposal remains unchanged and open for acceptance until July 14.
Vault plans to execute a definitive agreement with Genesis immediately following the contract termination.
