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Regis Resources drops bid for Vault Minerals, paving way for Genesis deal

Regis will pay about A$50.7 million in break fees as it terminates the scheme after saying the Genesis terms do not meet its investment criteria.

Reported · Written up by our desk · Mining

Regis Resources has abandoned its pursuit of Vault Minerals, clearing the way for Genesis Minerals to move ahead with a $3.9 billion, A$5.6-billion takeover of the gold producer. Mining.com said the decision follows Regis not exercising its right to match or improve Genesis’ proposal under a scheme implementation agreement signed with Vault on May 4.

Regis said the higher offer failed to meet its investment criteria, and that it will receive a break fee of about A$50.7 million when the agreement is terminated. The company also said the terms it would have needed to meet to match the Genesis proposal do not satisfy the value and return thresholds it applies to growth opportunities.

The termination ends a takeover battle that reflected consolidation among mid-tier gold miners, as record bullion prices have strengthened balance sheets and increased appetite for acquisitions. Mining.com noted Genesis’ unchanged offer values Vault at a roughly 6% premium to Regis’ all-share bid and would create one of Australia’s largest gold producers, with a market value of about A$12.6 billion and annual production of up to 700,000 ounces.

Vault said it intends to terminate its agreement with Regis and enter into a definitive deal with Genesis. Mining.com reported that Vault shares reversed early losses to trade up as much as 0.8% at A$4.91, while Genesis climbed as much as 3% to A$5.84 on the ASX 200.

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