Sky Metals and Advance Plan Gold Spin-Out With $6m IPO

Sky Metals (ASX:SKY) and Advance Metals have signed a non-binding term sheet to combine their Australian gold projects into a new company that would seek ASX listing, which the companies say would let each concentrate on its other assets.

SKY would vend its Cullarin, Kangiara and Caledonian Projects in New South Wales into NewCo for 15,000,000 shares at a deemed issue price of $0.20 per share, representing $3 million, while Advance would contribute its Myrtleford and Beaufort Gold Projects in Victoria for 30,000,000 shares, representing $6 million. No cash consideration is payable to either company. NewCo is targeting an IPO to raise $6 million at $0.20 per share, with admission to ASX targeted for the first half of 2027 and a priority offer of up to $3 million to eligible AVM and SKY shareholders. On the indicative structure of 80,000,000 shares at listing, SKY would hold 18.75%, Advance approximately 37.5%, IPO investors 37.5% and seed investors approximately 6.25%. The vendor shares are expected to be subject to ASX escrow for 24 months from listing. The combined portfolio would cover more than 2,000km2 across southeastern Australia.

The term sheet is non-binding apart from customary exclusivity and confidentiality provisions. Completion depends on due diligence, formal arrangements, shareholder and regulatory approvals, the IPO and ASX admission, and the companies state there is no certainty the transaction or IPO will proceed.