Astral's Offer Values Maximus Shares at $0.073, Marking 61% Premium

Context of the Offer

Maximus Resources Limited (ASX: MXR) has formally responded to the off-market takeover bid from Astral Resources NL (ASX: AAR), recommending shareholders accept the offer in the absence of a superior proposal. Astral's bid proposes to acquire all outstanding Maximus shares it does not already own by issuing one Astral share for every two Maximus shares held. This offer implies a value of approximately $0.073 per Maximus share, representing a substantial 61% premium over Maximus's last undisturbed closing price.

The Maximus Board's unanimous endorsement reflects a strategic decision to consolidate assets and enhance shareholder value amid a competitive gold exploration landscape in Western Australia.

Rationale Behind the Recommendation

The Board highlights several compelling reasons for shareholders to accept the offer. Firstly, the premium offered is attractive relative to Maximus's recent trading prices and reflects a resource acquisition price of $93 per ounce based on Maximus's published JORC-compliant Mineral Resource Estimate.

Secondly, the offer provides Maximus shareholders with exposure to Astral's larger and more liquid share register. Astral's shares have demonstrated significantly higher trading volumes, with approximately $32 million traded in the three months prior to the initial announcement, compared to $2.3 million for Maximus shares over the same period. This liquidity advantage is expected to facilitate easier realisation of investment value for shareholders.

Additionally, the combined entity will hold a pro forma market capitalisation of around $205 million and a combined Mineral Resource of approximately 1.8 million ounces of gold. This consolidation includes Astral's flagship Mandilla Gold Project, one of the largest undeveloped single-pit gold deposits in Western Australia, currently advancing through feasibility studies.

Financial and Strategic Implications

Astral's strong cash position of approximately $25.2 million as of 31 December 2024 reduces near-term funding risks that Maximus currently faces as a non-cash-flow generating exploration entity. The offer also mitigates minority shareholder risks for those who might otherwise remain in a smaller, less liquid company.

The Maximus Directors, collectively holding about 1.2% of shares, have declared their intention to accept the offer, reinforcing confidence in the transaction. Astral currently holds a 19.95% stake in Maximus and has announced a Relevant Interest in 42.13% of Maximus shares, positioning it strongly to complete the acquisition.

Risks and Considerations

While the offer is recommended, shareholders are cautioned to consider potential risks, including the possibility of a superior proposal emerging, fluctuations in Astral's share price affecting the value of consideration, and tax implications. The offer is conditional on several factors, including a minimum acceptance threshold and regulatory approvals.

Shareholders who do not accept the offer and remain minority holders may face reduced liquidity and influence, especially if Astral acquires a controlling interest but less than 100% of shares.

Next Steps for Shareholders

The offer remains open until 7:00 pm (AEDT) on Friday, 7 March 2025, unless extended. Shareholders are encouraged to read the Target's Statement and Bidder's Statement carefully and seek independent financial, legal, or tax advice before making a decision. Acceptance instructions are provided in the Bidder's Statement, with options for online acceptance via Automic's investor portal or by returning a signed acceptance form.

Maximus shareholders should weigh the benefits of premium consideration and improved liquidity against the risks of remaining independent or awaiting potential competing offers.