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Gascoyne at the time of print. price is significantly undervalued,” Kin man- to demerge its Orexplore mineral analysis
Westgold’s takeover attempt comes aging director Andrew Munckton said in an business, with seed funding of $12 million,
almost 12 months after Gascoyne suc- ASX statement. by the end of the year. Swick shareholders
cessfully emerged from a lengthy period Upon confirming it had rejected the St will also receive Orexplore shares in addi-
in voluntary administration following a re- Barbara offer, Kin announced a rights issue tion to DDH1 shares, assuming completion
markable operational turnaround at its Dal- for $13 million to fast-track exploration at its of the demerger and receipt of all the nec-
garanga mine and processing plant in the recent Mt Flora and Iron King discoveries essary approvals.
Murchison region. at its Cardinia gold project, near Leonora. Swick indicated its board would unani-
Argonaut Securities director of research “The additional funding will allow us to mously recommend the merger proposal
John Macdonald welcomed the bidding continue to assess the recent discoveries in the absence of a superior offer and sub-
war. at Cardinia Hill and follow up on new pros- ject to an independent expert report which
“Good to see some corporate adventur- pects like Mt Flora, Eagle and Crow – in states the transaction is in the best interest
ism return to the gold market, with efficient short to maintain the very strong explora- of shareholders.
asset utilisation in mind,” Macdonald said. tion momentum we have built up over the “We have grown Swick to become the
On October 7, Kin confirmed it had re- past two years,” Munckton said. largest underground drilling contractor in
ceived a confidential non-binding indicative M&A activity was not restricted to the Australia with a market-leading position,
proposal from St Barbara for the purchase gold sector last month with drilling outfits defined by solid margins and established
of all the shares in the gold explorer it did DDH1 Ltd and Swick Mining Services Ltd top-tier clients throughout the years, both
not already own. agreeing to a $115 million business com- in Australia and internationally,” Swick man-
Unlike Gascoyne and Westgold, Kin in- bination which is expected to generate aging director Kent Swick said.
dicated it had engaged with St Barbara, FY2021 pro-forma revenue of about $445 “There is a strong commercial logic in
while canvassing the views of its major and million and EBITDA of $103 million. combining the DDH1 and Swick business-
substantial shareholders, but ultimately de- Under the terms of the proposed transac- es and being able to offer our customers
termined only the bidder would benefit from tion, Swick shareholders will receive shares a complete range of high-quality and in-
such a transaction. in DDH1 and create a “global-scale mineral novative mineral drilling services from the
St Barbara, which currently holds 19% of drilling business” with a balance of surface discovery phase, through to mining and
Kin, subsequently withdrew the offer. (about 60%) and underground (about 40%) completion. I am very proud that the team
“The Kin board welcomed the continued from a combined fleet of more than 170 at Swick have built a business that has
interest from St Barbara, noting that the rigs. been recognised and valued by another
proposed non-binding indicative proposal The proposed transaction does not im- high-quality peer.”
price suggests that the current Kin share pact Swick’s previously announced plans

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