Brightstar Resources and Aurumin are engaging in discussions to merge to consolidate their tenement holdings in the central Sandstone region in Western Australia.

Brightstar officially acquired the Sandstone gold project in December 2024, which has a 832,000-ounce (oz) resource, and Aurumin is developing the Central Sandstone gold project that comprises an 885,800oz resource.

Both companies have agreed to non-binding indicative terms for a scheme of arrangement.

Under the proposed agreement, Brightstar would acquire Aurumin for scrip consideration where Aurumin shareholders would receive one new Brightstar share for every 4.6 Aurumin shares held.

This is based on the 20-day volume weighted average share price of Brightstar of $0.54 per share, implying a value of $0.117 per Aurumin share.

If Brightstar and Aurumin were to merge, a consolidated greater Sandstone gold project would be created in the Goldfields region of WA, supported by a total mineral resource estimate of approximately 2.4 million ounces at 1.5 grams per tonne of gold.

“Brightstar and Aurumin recognise the combination represents a unique opportunity to de-risk and accelerate the development of the emerging Sandstone gold project, provide greater certainty for the development of new infrastructure in the region and unlock exploration synergies,” Brightstar said.

“The compelling logic of combining the respective tenements at Sandstone has been widely acknowledged within mining industry, equity markets and the press for some time as a transaction which has the potential to create significant value for the shareholders of both Brightstar and Aurumin.”

Mutual due diligence investigations are currently underway, with Brightstar and Aurumin to update their shareholders of any developments.

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