Spitfire Materials Limited (ASX:SPI) signed a binding terms sheet to acquire the remaining 89.62% stake in Aphrodite Gold Limited (ASX:AQQ) in a merger of equals transaction for AUD 28.7 million on August 13, 2017. The parties entered into a merger implementation agreement on September 4, 2017. The merger is to be implemented by way of a scheme of arrangement. As consideration, 1 share of Spitfire Materials Limited will be exchanged for every 2.8959 shares of Aphrodite Gold Limited and issue 221.09 million shares. Spitfire Materials Limited will issue 13.81 million option exercisable at the price of AUD 0.1158 per share. Spitfire Materials Limited will enter into agreements with each of the holders of unlisted options in Aphrodite Gold Limited under which Aphrodite Gold Limited option-holders will agree to transfer or cancel their unlisted options in exchange for unlisted options in Spitfire Materials Limited on equivalent terms. Prior to the transaction, Spitfire Materials Limited holds 74.13 million shares, representing 10.38% stake in Aphrodite Gold Limited. After the transaction, both the shareholders of Aphrodite Gold Limited and Spitfire Materials Limited will each hold approximately 50% of the combined entity. After the transaction, Spitfire Materials Limited will be the surviving entity. In the event of the termination of the transaction, the mutual break fee is AUD 0.32 million. Aphrodite Gold Limited will apply for delisting after the transaction. Neil Biddle and John Young will remain on the Board of Spitfire Materials Limited and Peter Buttigieg and Roger Mitchell will join the Board of Spitfire Materials Limited. After the transaction, Neil Biddle will be the Executive Director, John Young will continue as the Managing Director, Peter Buttigieg will be the Non-Executive Chairman and Roger Mitchell will be the Non-Executive Director of the combined entity. The total number of Aphrodite Gold Limited's Directors on the Board, including those appointed by Spitfire Materials Limited, will not exceed four. The geological staff of Aphrodite Gold Limited will remain with Spitfire Materials Limited. The transaction is subject to mutual due diligence, entering into a merger implementation agreement, receipt of all regulatory, shareholder and other approvals including (without limitation) the approval of the ASX and any necessary approvals, waivers or modifications of the Corporations Act from the Australian Securities and Investment Commission, approval of holders' of Aphrodite Gold Limited shares under the scheme of arrangement, the approval of the scheme of arrangement by a court of competent jurisdiction under the Corporations Act, an independent expert providing its opinion to Aphrodite Gold Limited that concludes that the scheme of arrangement is in the best interests of Aphrodite Gold Limited shareholders (excluding Spitfire Materials Limited) and the independent expert not withdrawing or adversely modifying that conclusion, other customary conditions precedent, including but not limited to the absence of a material adverse change in the business affairs, financial conditions of each Spitfire Materials Limited and Aphrodite Gold Limited and no material transactions being entered into by either Spitfire Materials Limited and Aphrodite Gold Limited with the usual or customary carve outs, no prescribed occurrence occurring, accuracy of representations and warranties, obtaining material third party consents and/or waivers, entry into a binding agreement in relation to the cancellation of existing Aphrodite Gold Limited's options and other customary conditions. The term sheet also contains customary provisions to be included in the merger implementation agreement covering exclusive dealing, no shop and no talk. Spitfire Materials Limited and Aphrodite Gold Limited have agreed to complete due diligence and negotiate the agreement by August 25, 2017. On August 25, 2017, Spitfire Materials Limited and Aphrodite Gold Limited have extended to complete due diligence and negotiate the agreement by August 25, 2017 to September 1, 2017. The term sheet provides that the agreement will include provisions that the Directors of Aphrodite, will recommend the transaction and intend to vote in favor of the transaction resolutions and any general meeting resolutions in relation to their personal shareholdings in Aphrodite, in the absence of a superior proposal. Transaction will generate significant value for the shareholders of Aphrodite Gold Limited and Spitfire Materials Limited. As of September 4, 2017, the Board of Directors of Aphrodite Gold Limited unanimously recommended the shareholders to vote in favor of the transaction, in the absence of a superior proposal. The parties will form a transaction implementation committee to implement the transaction. Aphrodite Gold Limited's shareholders' meeting for approval is expected to be held on December 11, 2017 and the expected scheme implementation date is December 21, 2017. If the deal is approved by the shareholders, second court approval is due on December 20 2017. As on the effective scheme implementation date is December 20, 2017. Shareholders of Aphrodite Gold Limited approved the transaction. Federal Court of Australia at the Court approved the transaction on December 20, 2017 and all conditions of transaction are satisfied now. Hartleys Limited acted as the financial advisor and Steinepreis Paganin acted as the legal advisor to Spitfire Materials Limited. GTP Legal acted as the legal advisor and Michael Beer of Beer & Co. Pty Ltd acted as the financial advisor to Aphrodite Gold Limited. Nicholas Read of Read Corporate acted as the public relations advisor to Spitfire Materials Limited in the transaction. Stefan Collins, Adam Myers and Sherif Andrawes of BDO Corporate Finance (WA) Pty Ltd acted as independent experts for Aphrodite Gold Limited and consider the offer as fair and reasonable. Paul Dunbar of and Shaun Searle of Dunbar Resource Management acted as technical experts, Computershare Investor Services Pty Limited acted as share registrar for Spitfire Materials Limited and Security Transfer acted as share registrar for Aphrodite. Deloitte Tax Services Pty Ltd. acted as tax advisor for Aphrodite Gold Limited. Spitfire Materials Limited (ASX:SPI) completed the acquisition of remaining 89.62% stake in Aphrodite Gold Limited (ASX:AQQ) in a merger of equals transaction on January 4, 2018.