Great Divide Mining has settled its dispute with Adelong Gold Limited, paving the way for full ownership of Challenger Mines and marking a key milestone in its transition to producer status.
- Dispute with Adelong Gold Limited over Challenger Mines resolved
- Acquisition of remaining 49% stake in Challenger Mines finalized
- Share Sale Agreement amended to replace buy-back with right of first offer
- Settlement sum of $134,288 payable by ADG upon completion
- Royalty agreement and escrow deed executed, signaling operational progress
Resolution of Long-Standing Dispute
Great Divide Mining Ltd (ASX, GDM) has announced the resolution of its protracted dispute with Adelong Gold Limited (ADG) concerning their joint venture in Challenger Mines Pty Ltd (CMPL). The dispute centered on GDM's 51% interest in CMPL, a company holding the historic Challenger Gold Mine in New South Wales. The settlement confirms the binding agreements previously disclosed, with key amendments that remove GDM's ability to force a buy-back of shares issued to ADG, replacing it with a right of first offer on any future share sales by ADG.
Acquisition and Corporate Changes
Under the revised Share Sale and Purchase Agreement, GDM will acquire the remaining shares in CMPL, effectively consolidating full ownership of the Challenger Gold Mine. This acquisition is expected to complete following a General Meeting scheduled for early 2026, where shareholders will vote on the issuance of consideration shares to ADG. Upon completion, key officers Ian Holland and Mena Habib will resign from CMPL, and the joint venture will be formally terminated.
Financial and Operational Implications
ADG will pay a settlement sum of $134,288 to GDM at completion, while the execution of the Minerals Royalty Deed signals the commencement of royalty payments tied to production. This development marks a significant milestone for GDM, which transitioned from explorer to producer in 2025 with the start of production at the Challenger Gold Mine. The company’s broader strategy of leveraging historically mined areas with existing infrastructure aims to accelerate cash flow generation and fund further exploration.
Governance and Tax Cooperation
The settlement also introduces new provisions for tax indemnities and cooperation between GDM and ADG, reflecting a pragmatic approach to managing potential future tax claims arising from the transaction. Additionally, the signing of the Voluntary Escrow Deed provides further assurance to shareholders regarding the management of consideration shares issued to ADG.
Looking Ahead
With the dispute behind it and full control of Challenger Mines secured, Great Divide Mining is well positioned to focus on operational ramp-up and value creation. The upcoming General Meeting and subsequent completion of the acquisition will be critical milestones to watch, as will the commencement of royalty payments and any further updates on production progress.
Bottom Line?
Great Divide Mining’s dispute resolution and acquisition pave the way for operational focus and growth at Challenger Gold Mine.
Questions in the middle?
- Will the General Meeting approve the share issuance without shareholder opposition?
- How quickly can GDM ramp up production and generate meaningful cash flow from Challenger Gold Mine?
- What are the potential tax risks and how will the new indemnity provisions mitigate them?