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The hammer falls for Austral on Hammer Metals acquisition

JMM

Key Facts:

• The deal: Austral to acquire 100% of Hammer Metals via scheme of arrangement; Larvotto has stood aside, and Hammer's Board unanimously backs the Austral offer.
• Value on the table: Implied ~A$0.100 per Hammer share (A$0.087 base consideration), a 70.6% premium to Hammer's pre-bid price; total equity value ~A$80.7 million.
• Strategic rationale: Combines Rocklands processing infrastructure with Hammer's Kalman deposit (39.2Mt @ 1.1% CuEq), positioning the merged group as a Queensland-focused copper producer/developer.
• Ownership split: Hammer shareholders to hold ~31.1% of the enlarged Austral group, retaining upside exposure alongside the premium.
• Timeline: Scheme meeting and court approvals expected October – November 2026, with implementation targeted for November 2026.

Austral Resources locks in deal to acquire Hammer Metals, targets Queensland copper powerhouse

Austral Resources Australia Ltd (ASX: AR1) has executed a binding Scheme Implementation Deed to acquire 100% of Hammer Metals Limited (ASX: HMX), after Larvotto Resources (ASX: LRV) confirmed it will not match Austral's offer. The Hammer Board has unanimously recommended the deal, subject to no superior proposal and independent expert approval.

Hammer shareholders will receive 1.2903 Austral shares per share held, plus participation in the demerger of Hammer's WA gold assets into "SpinCo." Based on Austral's 7 August closing price, the total implied value is approximately A$0.100 per Hammer share, including A$0.007 attributable to SpinCo - a 70.6% premium to Hammer's pre-Larvotto share price.

The tie-up combines Austral's Rocklands processing operation with Hammer's flagship Kalman deposit (39.2Mt at 1.1% CuEq, 60km away), creating a resource base with expanded scale and future feed potential. Hammer shareholders will hold roughly 31.1% of the enlarged group.

Implementation is expected around November 2026, subject to court and shareholder approval.

Austral’s Chairman, David Newling, says:

“The execution of the Scheme Implementation Deed marks an important step in Austral Resources’ strategy to build a leading Queensland copper company. Hammer’s resource base and exploration portfolio are highly complementary to Austral Resource’s existing operations, infrastructure and development plans. The combination creates a stronger regional platform, with the potential to unlock significant value through greater scale, infrastructure utilisation and future resource development.

Importantly, the transaction delivers a substantial premium for Hammer shareholders while allowing them to retain meaningful exposure to the future growth of the combined business. Together, Austral Resources and Hammer will create a stronger platform to pursue our ambition of becoming Australia’s next mid-tier copper powerhouse."

About us:

Austral Resources Australia Ltd is an ASX listed copper cathode producer operating in the Mt Isa region, Queensland, Australia. Its Mt Kelly copper oxide heap leach and solvent extraction electrowinning (SX-EW) plant has a nameplate capacity of 30,000tpa of copper cathode. The recent acquisition of the Rocklands Facility enables the dual processing capabilities for copper sulphides and copper oxides, as well as an increased exposure to gold. Austral has recently embarked on an aggressive growth and consolidation strategy across the World Class Mount Isa Region, which includes the Lady Loretta and Rocklands Deposit. Austral now owns a significant copper inventory with a JORC compliant Mineral Resource Estimate standing at 64 Mt @ 0.73% Cu (468,414t of contained copper)(comprising of 52.8Mt @ 0.74% Cu at the Lady Annie Project – 8.8Mt at 0.75% Cu Measured MRE, 33.0Mt at 0.76% Cu Indicated MRE and 11.0Mt at 0.69% Cu Inferred MRE and 11.26Mt at 0.69% Cu at the Rocklands Project – 9.12Mt at 0.72% Cu Indicated MRE and 2.14Mt at 0.55% Cu Inferred MRE), two processing facilities, as well as 2,101km 2 of highly prospective exploration tenure in the heart of the Mt Isa district, a world class copper and base metals province. The Company intends to implement an intensive exploration and development program designed to extend the life of mine, increase its resource base and continually review options to commercialise its copper resources.

Contact details:

Austral Resources Corporate Affairs and Stakeholder Relations: Emma Godfrey, 0419 523 719, [email protected]

Jane Morgan Management Investor and Media Relations: Wilamina Russo, 0450 646 609, [email protected]