Brightstar Raises $50m to Accelerate Sandstone Gold District Merger
Brightstar Resources has agreed to acquire Aurumin Limited in a $60 million scheme, raising $50 million to accelerate development of the Sandstone gold district in Western Australia. The merger creates a combined entity with nearly 4 million ounces of gold resources and a strong cash position.
- Brightstar to acquire 100% of Aurumin via scheme of arrangement
- Aurumin shareholders receive 1 Brightstar share per 4 Aurumin shares, ~20-27% premium
- $50 million placement secured to fund accelerated exploration and development
- Combined Mineral Resource of 3.9 million ounces gold at 1.5g/t
- Pre-feasibility study on consolidated Sandstone assets targeted for 1H 2026
A Strategic Consolidation in Sandstone
Brightstar Resources Limited (ASX – BTR) and Aurumin Limited (ASX – AUN) have formalised their merger plans through a binding Scheme Implementation Deed, under which Brightstar will acquire 100% of Aurumin’s issued capital. This deal consolidates two significant players in the Sandstone gold district of Western Australia, creating a combined entity with a pro forma Mineral Resource base of 3.9 million ounces of gold at an average grade of 1.5 grams per tonne.
The transaction offers Aurumin shareholders one Brightstar share for every four Aurumin shares held, reflecting an implied value of approximately $0.12 per Aurumin share. This represents a premium ranging from 20% to 27% over recent Aurumin trading prices, signaling a strong vote of confidence in the combined entity’s growth prospects.
Capital Raising to Accelerate Growth
To underpin the accelerated development of the Sandstone gold district, Brightstar has secured binding commitments to raise $50 million through a placement priced at $0.48 per share. This capital injection is earmarked for an aggressive drilling campaign, feasibility studies, and permitting activities across the combined portfolio, including a targeted pre-feasibility study (PFS) on the consolidated Sandstone assets scheduled for release in the first half of calendar year 2026.
Following completion of the merger and placement, the pro forma Brightstar entity will hold a substantial landholding of approximately 1,600 square kilometres in the Sandstone region. This district-scale footprint, combined with existing production hubs at Laverton and Menzies, positions the group to fast-track open pit development opportunities and pursue its ambition of becoming a mid-tier gold producer in Western Australia within the next four to five years.
Board and Shareholder Support
The Aurumin Board, representing around 16% of Aurumin shares, has unanimously recommended the scheme, with directors intending to vote their shares in favour, subject to the absence of a superior proposal and a positive independent expert opinion. Aurumin is also working to secure statements of support from unassociated shareholders holding at least 30% of the shares, further bolstering the likelihood of scheme approval.
Brightstar’s Managing Director, Alex Rovira, emphasised the strategic logic of the deal, highlighting the potential to de-risk and accelerate development activities at Sandstone. Aurumin’s Managing Director, Daniel Raihani, echoed this sentiment, noting the commercial sense of combining adjacent mineral resources and the benefits of exposure to a larger, diversified gold portfolio.
Looking Ahead
The combined group will emerge with a pro forma cash position of approximately $63 million, providing financial flexibility to advance exploration and development. The consolidation follows Brightstar’s recent acquisitions of the Sandstone Gold Project via Alto Metals Ltd and the Montague Project from Gateway Mining Ltd, further strengthening its asset base.
While the transaction is subject to customary conditions including court approval and regulatory consents, the merger is poised to reshape the Sandstone gold district’s development landscape. Investors will be watching closely as the combined group progresses its PFS and moves towards unlocking value from this emerging open pit gold opportunity.
Bottom Line?
Brightstar’s consolidation of Aurumin and capital raise set the stage for a transformative chapter in Sandstone’s gold development story.
Questions in the middle?
- Will the independent expert endorse the scheme as being in Aurumin shareholders’ best interests?
- How will the combined group prioritize exploration and development across its expanded asset base?
- Could competing bids or regulatory hurdles delay or alter the merger timeline?