Larvotto digs in as Hammer takeover battle heats up

Larvotto Resources has stood behind its acquisition of Hammer Metals after a rival takeover proposal from ASX-listed Austral Resources emerged, saying its existing scheme offers Hammer shareholders a compelling mix of value, certainty and exposure to a larger ASX-listed resources group.

The company moved to underline the merits of its June scheme implementation deed with Hammer, following the competing indicative proposal. Larvotto fired back, saying Austral’s approach remains non-binding, indicative, conditional and not currently capable of acceptance.

Additionally, progressing any transaction with the alternative suitor would still be subject to the completion of potentially lengthy mutual due diligence and the negotiation of key deal documents. The rival bid also relies on Larvotto not deploying its matching right.   

Hammer’s ASX release says its board has not changed its recommendation and still supports the Larvotto scheme, in the absence of a superior proposal and subject to an independent expert concluding the deal is in the best interests of Hammer shareholders.

Under the agreed deal, Hammer shareholders would receive one Larvotto share for every 22 Hammer shares held, valuing the bid at 5.6 cents per Hammer share. A successful bid would give them an ongoing stake in a combined group with exposure to Larvotto’s Hillgrove gold-antimony project in New South Wales and Hammer’s copper-gold portfolio at Mt Isa in Queensland.

In contrast, Austral has tabled a combined all-scrip deal worth 8.7c, comprising 8 cents in Austral shares and the balance in shares to a new spin-out company holding Austral’s Western Australian exploration assets. 

Larvotto has framed its offer as a more certain path for Hammer investors, pointing to the agreed transaction, the Hammer board’s current recommendation and the defined ownership structure already on the table. It says Austral's proposal may also prompt some Hammer shareholders to consider the potential dilution associated with issuing a significant number of new shares to complete the transaction.

The company says the proposed merger would fold Larvotto’s development-ready Hillgrove gold-antimony project in NSW together with Hammer’s Mt Isa copper-gold assets, creating a bigger, more liquid resources group with greater scale, a stronger balance sheet and more than 530,000 tonnes of copper equivalent resources.

The broader transaction has won the backing of global commodities giant Glencore International, which tipped $15 million into Larvotto to support its Hammer bid. Glencore also signed a binding seven-year gold concentrate offtake agreement last month, locking in a secure route to market for Hillgrove's antimony-gold production ahead of the project's planned August 2026 start-up.

For now, Larvotto’s message is simple enough. The signed Hammer agreement remains in place, the Hammer board’s recommendation still stands and the company believes its offer gives Hammer shareholders a more advanced route into a bigger, more liquid resources story.

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