Xanadu Mines (XAM) Investor Update summary

Transaction overview

• Bastion Mining, led by Boroo, has made an off-market takeover bid at AUD 0.08 per share, representing a premium of over 50% to recent prices and requiring a minimum 50.1% acceptance for control.

• Bastion will also subscribe for shares at AUD 0.06 per share, raising AUD 17.2 million to fund operations during the bid period, with a seven-day hold period before completion.

• The bid is recommended by the Takeover Bid Committee, subject to no superior proposal and a fair and reasonable opinion from the independent expert.

• The bid period is expected to open early next week, with an indicative closing date of July 2, 2025.

• Bastion is a consortium with strong Mongolian mining experience, seen as a natural partner for the Kharmagtai Project.

Rationale and process

• The offer provides immediate liquidity, avoids future dilution, and resolves funding for the Kharmagtai Project.

• The placement to Bastion is within the company's 7.1 placement capacity and does not require shareholder approval.

• The board has received positive feedback from major shareholders, with about 30% support already indicated.

• If less than 50% of shares are tendered, the company will continue as a JV with Zijin, with alternative funding options available.

• The independent expert for the offer is BDO, with technical input from ERM/CSA Global.

Competitive landscape and alternatives

• Zijin was previously in exclusivity but did not proceed with a binding offer; no other bids are currently on the table.

• The process included significant due diligence by Zijin, but competitive tension was limited by perceptions of political risk and project complexity.

• The bid allows for the possibility of a superior offer during the hold period, but competing bids become harder once the bid period opens.

• Bastion's Mongolian involvement is seen as reducing political risk and aligning with government interests.

• If the bid fails, the company has structured debt options and sufficient funds to continue project development.