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Atlas and Aurox tie the knot

Merger follows close relationship

Two of the Pilbara’s leading juniors are merging in a move to improve reserves and infrastructure.

Last month Atlas Iron and Aurox Resources had already agreed to a deal for Atlas to share Aurox’ allocation of capacity at the Utah Point port facility in Port Hedland but the companies will now have much closer ties.

A merger will see Atlas issue Aurox shareholders one Atlas share for every three Aurox shares (option-holders will also be offered a deal). The Aurox board has unanimously recommended its shareholders accept the offer.

The merger is seen as win/win – giving Atlas increased shipping access and reserves while Aurox gets the benefit of an experienced Pilbrara iron ore producer.

Atlas said it will receive an additional 10-12 million tonnes per annum in long term port capacity which has been secured by Aurox as well as the company’s 456 million tonne Balla Balla magnetite project.

This lifts the combined port capacity to 33mtpa and increases the reserves and resources of its projects.

Atlas is already exporting ore from its Pardoo mine – shipping more than one million tonnes last year but this will more than doubled following a ramp-up this year and this will increase again when its Wodgina project begins production later this year. Atlas has already secured offtake agreements for 1.1 million tonnes from Wodgina.