Larvotto Resources (ASX:LRV) has decided to not exercise its rights under the scheme implementation deed, forfeiting the company’s proposal to acquire Hammer Metals (ASX:HMX).
The board determined that the terms required to match Austral Resources’ (ASX:AR1) proposal would not “satisfy the value and return thresholds applied to all growth opportunities under Larvotto’s strategic plan”.
Larvotto is focused on maintaining its disciplined approach that will allow the company to create sustainable, long-term shareholder value.
Today marked the last day for Larvotto to submit a counteroffer to acquire Hammer Metals, after Austral submitted a definitive written and binding proposal through a court-approved scheme of arrangement on Monday 3 August.
Larvotto Resources placed a bid to acquire Hammer Metals through a court-approved scheme of arrangement in early June, implying an offer price of $0.06 per Hammer share, a fully diluted equity value for Hammer of around $54 million, and an 18% premium to Hammer’s closing share price on 4 June 2026.
This offer was based on Larvotto’s closing share price of $1.33 on 5 June 2026.
For Larvotto, the acquisition would add 530,000 tonnes of copper equivalent JORC resources to Larvotto’s holdings via the acquisition of Hammer’s Mt Isa portfolio.
Austral’s proposal is valued at $0.087 per Hammer share or around $80.7 million in aggregate, comprising 1.29 Austral shares for each Hammer share held at $0.080 each, alongside $0.007 per Hammer share of implied value through shares in Carnegie Exploration.
Hammer shareholders are expected to have an aggregate ownership of around 31.1% of the enlarged Austral under this proposal.
The total consideration for this transaction represents a premium of 50.8% to the offer price listed in Larvotto’s bid.
Hammer deemed Austral’s proposal to be superior last week, offering Larvotto five business days to provide a matching, equivalent, or superior proposal.
Larvotto anticipates that Hammer Metals will terminate its scheme implementation deed if the Hammer board decides to proceed with the Austral proposal.
Larvotto says the company “remains in a position of strength”, which is underpinned by ongoing staged commissioning of the minerals processing facility at the Hillgrove mine in New South Wales, which will provide a pathway to near-term production.
The Hillgrove mine is expected to produce around 4,900 tonnes of antimony and more than 40,000 ounces of gold annually upon achieving steady state production over the current seven-year mine life.
Larvotto Resources is advancing its portfolio of critical and precious mineral projects in New South Wales and across Australia.
Write to Maddison Elliott at Mining.com.au
Images: Larvotto Resources
