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More gold for Blakes

More gold for Blakes

BLAKE DAWSON WALDRON acted for Lihir Gold Limited on its merger via scheme of arrangement with Ballarat Goldfields NL — Lihir’s first major investment outside its gold mine in Papua New…

BLAKE DAWSON WALDRON acted for Lihir Gold Limited on its merger via scheme of arrangement with Ballarat Goldfields NL — Lihir’s first major investment outside its gold mine in Papua New Guinea.

Baker & McKenzie advised Ballarat Goldfields NL.

At a recent meeting in Ballarat, more than 94 per cent of Ballarat Goldfield’s 8,000 shareholders voted in favour of the proposed scheme of arrangement, which will see Ballarat Goldfields become a wholly-owned subsidiary of Lihir.

“Together these two companies will create a new Asia-Pacific gold leader, with a strong growth profile, a secure financial base and more diversified operations,” said Lihir chair, Ross Garnaut, in a statement.

Ballarat Goldfields will add 130 employees and contractors to form a company with a total workforce of around 4,000.

“It’s a single mine company on Lihir Island, PNG, so it’s a significant transaction for Lihir because it’s their first investment outside PNG,” said lead partner on the deal, Philip Maxwell.

“It’s significant for Ballarat investors, [as well] of course, because it is their home-town company.”

Under the scheme, Ballarat Goldfields shareholders will receive five new Lihir shares for every 54 Ballarat Goldfields shares held.

Alister Maitland, chair of Ballarat Goldfields, said the deal would secure funding for a $120 million development plan for the Ballarat East and Ballarat Goldfields, as well as other exploration projects, and also gives Ballarat Goldfields shareholders ownership in a major Asia-Pacific gold producer.

The Ballarat goldfields are due to begin production by next year, and are projected to add 100,000 ounces of gold in 2008 to Lihir’s projected output this year of around 800,000 ounces.

Lihir operates one of the world’s largest gold mines on the island of Lihir, 900 kilometres north-east of Port Moresby, in PNG’s New Ireland province.

In October 2005, the company moved to fully independent management after a decade of management, under contract, by Rio Tinto.

Lihir CEO Arthur Hood said gold production at Ballarat would double in 2009 to 200,000 ounces and the company was undertaking a feasibility study to lift capacity on Lihir Island to more than a million ounces per year.

“Combined the company should be producing 1.25 million ounces of gold by 2010,” he said.

The board approved merger of the two companies was originally announced on 17 October last year. The agreement was due to go to a second hearing in court on 27 February and the scheme was to come into effect on 26 February.

As well as Maxwell, his team included David Frecker, Rod Mackinnon, Darren Mackenzie, Rebecca Tsang and Anton Harris (corporate — acquisition); Martin Kudnig, Robert Jamieson, Jane Hall, Vanessa Flax, Meredith Gibbs, Clare Lawrence, Kathleen Birrell (Melbourne property and projects); Richard Bunting, Sue Mitra, Danya Linden (Melbourne IRE); Richard Flynn in PNG; Richard Fawcett, Simon Harvey (financial services); and Barbara Phair (stamp duty).

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