Amara Mining agrees merger with Australia's Perseus

(ShareCast News) - Amara Mining has agreed an all-paper merger with Australia's Perseus Mining that values Amara at £68.3m, or 16.3p per share. Shareholders in AIM-listed Amara, which will own 35.1% of the enlarged entity, have been offered 0.68 new Perseus shares for each AMA share, together with a warrant for 0.34 Perseus shares that will strike at AUD 0.44 per share for a period of 36 months.Recommending the deal to their shareholders, the board of the two companies said the offer represented a 42% premium to Amara's price on Friday of 10.3p, or a 28% premium against the 20-day volume-weighted average.Perseus shares have traded down 11%, pointing to a current implied value of 12.8p per share for Amara, or a 25% premium to Friday's price, excluding the warrant.Investors representing just over 16% of Amara's shares have made irrevocable commitments to vote in favour of the transaction and an additional 21.8% have provided letters of intent to vote in favour of the transaction. House broker Peel Hunt noted that the Edikan gold mine in Ghana developed by Perseus in 2011 produced 212,000 oz in 2015 and Amara's Yaoure gold project is set to produce in excess of 200,000 oz a year once it is taken through the final development phases and into production."The Yaoure project will benefit from Perseus' strong balance sheet and the cash flow from Edikan which should ease funding concerns surrounding the development of Yaoure. Having developed a mine in west africa in recent years Perseus also offers a considerable build out of the Yaoure technical team."Shares in Amara rose 17% to 12p on Monday.