WCB Resources and GBM Resources have executed a binding Heads Of Agreement to merge the two companies. The merger will allow the companies to create a new Australasian focused gold development and exploration group.

The merger combines the advanced stage gold assets of Mt Coolon in Queensland, Australia and the Misima Gold Project in Papua New Guinea in addition to the extensive exploration assets of both companies.

GBM tenements cover an area greater than 2600sqkm in eight major project areas in Queensland and Victoria, including the Koala mine and the Glen Eva mine, which are expected to begin production by the end of 2017. It also has an investment in Singapore-listed Anchor Resources which holds the Lubik Mandi Gold Project in Malaysia.

Each WCB shareholder will receive eight ordinary shares of GBM for each common share of WCB they hold in consideration for the transfer of those WCB shares to GBM. Upon completion of the merger, WCB shareholders will hold 36% and GBM shareholders will hold approximately 64% of the merged entity.

Both companies have major shareholder support and the directors of both companies unanimously support the merger in the absence of a superior proposal.

The Boards of ASX-listed GBM and TSX-V listed WCB consider that the combination of the two companies will provide significant strategic and financial benefits to both sets of shareholders.

GBM’s resources include measured resources of 114,000 tonnes @ 1.7 g/t for 6200 ounces, indicated resources of 3.993 million tonnes @ 1.4 g/t for 173,800 ounces and inferred resources of 2.415 million tonnes @ 1.7 g/t for 134,800 ounces.

WCB’s resources at the Misima Island project include indicated resources of 36 million tonnes @ 1.1 g/t for 1.3 million ounces and inferred resources of 11 million tonnes @ 1.1 g/t for 400,000 ounces.

Significant growth opportunities for discovery of additional resources exist within both the Mt Coolon and Misima projects.

GBM executive chairman Peter Thompson said, “The complementary nature of the two companies’ projects creates a strong platform for both companies’ shareholders to benefit from a substantial value uplift from a significant increase in combined gold resources at Misima and Mt Coolon, and the ability to step up exploration within the group’s extensive landholding.

“We look forward to welcoming WCB president and CEO Cameron Switzer to the Board of the combined entity as an executive director, where his strong, long-term understanding of the Misima Gold Mine will prove invaluable.”

Cameron Switzer said, “The Board of WCB considers this merger to be an outstanding opportunity. The attractiveness regarding the focus on near-term production and cash flow from Mt Coolon underpins the group moving forward. The significant exploration upside identified at both the Misima and Mt Coolon project has the potential to ensure that the merged company has an exciting future with significant growth optionality moving forward.”

The immediate focus of the merged group will be reopening and development of the Mt Coolon Gold Mine which will enable the group to be funded moving forward.

The focus at Misima is completion of a gold resource update to include recent surface extensions and controls on mineralisation, pit optimisation sensitivity and financial studies followed by drill testing for resource extension, geotechnical and metallurgical parameters.

The new entity will be fully funded to achieve gold production at Mt Coolon in 2017 and support the ongoing exploration strategies of both the Misima and Mt Coolon projects. Both properties have the potential to be mid-tier gold production assets with significant discovery upside and both companies have Pan Pacific Co Ltd as their joint venture partners.

www.wcbresources.com and www.gbmr.com.au