Adriatic Metals (ADT) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of Adriatic Metals for up to $1.3 billion creates a premier, diversified mining group with enhanced production, reserves, and a compelling metal mix, leveraging DPM's operational expertise and financial strength in the Balkans.

• The deal aligns with DPM's growth strategy, providing immediate production growth, mine life extension, and cash flow diversification, especially through Adriatic's Vareš Silver Operation.

• Adriatic shareholders gain exposure to a larger, diversified mining group and future growth opportunities via new DPM shares.

• DPM intends to optimize Adriatic's assets, maintain strong community and stakeholder engagement, and leverage regional experience.

• Enhances portfolio with a multi-asset, jurisdictional growth platform and diversification.

Financial terms and conditions

• Adriatic shareholders receive 0.159 DPM shares and 93 pence in cash per share, with options for all-cash, all-shares, or a mix, subject to proration and a mix and match facility.

• Implied value per Adriatic share is AUD 5.56, GBP 2.38, or 268 pence, valuing the company at approximately $1.3 billion.

• The offer represents a 50.5% premium to Adriatic's LSE closing price on 19 May 2025 and a 47.8% premium to the ASX closing price on 20 May 2025.

• Adriatic shareholders will own about 25% of the combined entity.

• DPM will fund the cash portion from existing resources, with BMO confirming sufficiency of funds.

Synergies and expected cost savings

• Operational and corporate synergies expected from combining Vareš with DPM’s expertise, financial strength, and optimized capital allocation.

• Optimization opportunities include ore sorting and reduced mine waste transport to lower costs and improve grades.

• DPM's strong balance sheet will fund Vareš ramp-up, new mine construction, and accelerated exploration, avoiding dilution from third-party financing.

• Integration of Adriatic's mining personnel is expected to de-risk DPM's Čoka Rakita Project.

• Enhanced exploration and development potential leveraging DPM’s regional experience.