Silver Lake shareholders approve merger with Red 5

Silver Lake Resources (ASX: SLR) shareholders approved on Friday the sale of the company to Red 5 (ASX: RED) for A$2.2-billion ($2 billion), creating Australia’s fifth-largest gold producer.

The deal, pitched in February as a “merger of equals”, blends two complementary gold business, increasing the scale and asset diversification of the combined miner. This new entity will have a A$2.9 billion market capitalization, estimated production of 445,000 oz. of gold this year, with reserves of 4 million oz. and resources of 12.4 million ounces.

Silver Lake shareholders will control a combined 48.3% of the merged miner, with Red 5’s Russel Clark to be chair of the company and Silver Lake’s Luke Tonkin as managing director and CEO.

Western Australia-based Red 5 owns the King of the Hills (KOTH) mine and processing hub, which is located 28 km north of the Leonora region, a tier-one gold mining area in WA. 

KOTH is also 80 km south of the company’s Darlot satellite gold mine, centred in the eastern Goldfields region of WA as another prominent gold mining town.

Silver Lake owns two significant projects in Western Australia — the Mount Monger asset in the eastern Goldfields region and the Deflector gold-copper project in the southern Murchison region. 

It also has the mothballed Sugar Zone gold mine in northern Ontario, which it bought in 2022. The two companies did not say when this underground mine might resume production.