WHITE RIVER - A new name on the marquee of the Sugar Zone gold mine, north of White River, appears to be in the offing this summer.
Shareholders of Silver Lake Resources have approved its acquisition by Red 5 Ltd. Both are West Australian gold mining companies.
The $2.2-billion Australian ($1.9 billion Canadian) deal, first announced in February, includes a takeover of the dormant Sugar Zone operation, 30 kilometres north of White River. The transaction has been framed as a “merger of equals.”
Silver Lake shareholders will hold 48.3 per cent of the company. Red 5’s Russel Clark will be board chair and Luke Tonkin of Silver Lake will be managing director and CEO.
There’s no word on when mining will resume.
The Supreme Court of New South Wales approved the transaction on June 6. Silver Lake expects the Australian Stock Exchange will suspend its shares from trading on June 7 and delist them on June 20.
The combined company will have four mines in Western Australian gold country, along with only Canadian operation near White River.
Silver Lake picked up Sugar Zone in early 2022 through a CCAA sales process. By the summer of 2023, a decision was made to halt mining operations and haul in the drill rigs to gain a better understanding of the geology around the underground mine. Silver Lake committed to upgrading the operation and address operating inefficiencies. The company had said nothing on the status of its workforce.
In a related matter, Silver Lake planned to move a worker accommodations camp from White River to the mine site to reduce commuting time.
