Deep Yellow Limited and Vimy Resources Limited Agree to a Proposed $658M Merger

Deep Yellow Ltd. (ASX:DYL) (FRA:JMI) (OTCMKTS:DYLLF) and Vimy Resources Ltd. (ASX:VMY) (OTCMKTS:VMRSF) are pleased to announce that they have entered into a Scheme Implementation Deed (SID), under which the two companies propose to merge by way of a recommended court-approved scheme of arrangement between Vimy and its shareholders (Scheme).

HIGHLIGHTS

- Deep Yellow and Vimy have agreed to a merger by a Scheme of Arrangement, under which Deep Yellow will acquire 100% of the Vimy Shares on issue

- Vimy Shareholders will receive 0.294 Deep Yellow Shares for every Vimy Share held on the Scheme record date

- The merger transaction implies 28.5c per Vimy Share representing a premium of 35.3% to the 30-day VWAP and a 18.8% premium to the closing Vimy Share price on 25 March 2022 (being the last trading day for Vimy Shares and Deep Yellow Shares prior to this announcement)

- Upon implementation of the Scheme, Deep Yellow shareholders will hold 53% of the Merged Group and Vimy Shareholders will hold 47%

- The Scheme is unanimously recommended by the Board of Vimy and each director of Vimy intends to vote all Vimy Shares they control in favour of the Scheme, in the absence of a Superior Proposal, and subject to an Independent Expert opining (and continuing to opine) that the Scheme is in the best interests of Vimy Shareholders

- The merger is expected to create a new global uranium player with significant scale, cash resources of $106 million , one of the largest uranium Mineral Resource inventories globally (389Mlb ) and two advanced, world class assets in Tier-1 uranium mining jurisdictions

- Deep Yellow and Vimy will host a joint investor call at 10AM AWST (1PM AEDT) today, 31 March 2022
On implementation of the Scheme, the merger of Deep Yellow and Vimy (Merger) will combine the two companies to form a merged group (Merged Group) with complementary asset bases, leveraging Deep Yellow's development, construction and operational expertise to unlock the development potential of the Mulga Rock Uranium Project (Mulga Rock), located in Western Australia. Combined with the future development of Deep Yellow's Tumas Project (Tumas) in Namibia, the Merged Group is expected to have the scale to rapidly advance its pipeline of organic growth opportunities and be well positioned to pursue additional disciplined value accretive growth.

Under the terms of the Scheme, each shareholder of Vimy (Vimy Shareholder) will receive 0.294 Deep Yellow ordinary fully paid shares (Deep Yellow Share) for every ordinary fully paid Vimy share (each a Vimy Share) held on the Scheme record date. If the Scheme is approved and implemented, Deep Yellow shareholders will hold 53% of the Merged Group and Vimy Shareholders will hold 47% of the Merged Group, in both cases on a fully diluted basis.

The Vimy Board unanimously recommends that Vimy Shareholders vote in favour of the Scheme, in the absence of a Superior Proposal and subject to the Independent Expert opining (and continuing to opine) that the Scheme is in the best interest of Vimy Shareholders.

Subject to those same qualifications, each Vimy director intends to vote all Vimy Shares they control in favour of the Scheme. As at the date of this announcement, the Vimy Board collectively holds 0.42% of Vimy Shares.

The Vimy Board has received a statement from Paradice Investment Management Pty Ltd (Paradice), the largest shareholder of both Vimy (owning 7.52% of Vimy Shares on issue) and Deep Yellow (owning 7.88% of Deep Yellow Shares on issue), advising that Paradice intends to vote or cause to be voted all the shares that it holds in Vimy in favour of the Scheme, in the absence of a superior proposal and subject to the Independent Expert opining that the Scheme is in the best interest of Vimy Shareholders (and subject to that opinion being maintained up to the date of the Scheme meeting).

John Borshoff, Managing Director and Chief Executive Officer of Deep Yellow, commented: "This Merger has the potential to be a significant value-creating opportunity for both Deep Yellow and Vimy Shareholders. The Merger combines two world class assets, both in Tier-1 mining jurisdictions, into a single group with scale and know-how. The expanded strong technical team of Deep Yellow, together with Vimy personnel, positions us well to bring both projects online when uranium prices support the generation of long-term, sustainable positive cash flows. Our vision has been to deliver growth organically and inorganically to Deep Yellow shareholders and I am very pleased we have started to achieve that in this process. This transaction also builds on the pipeline of exploration assets able to add growth organically and critically, creating a platform for additional value accretive acquisitions."

Steven Michael, Managing Director and Chief Executive Officer of Vimy, commented: "This Merger de-risks and underpins our path to development at Mulga Rock. The combined financial, processing and operating strengths of both companies will enable greater optimisation and the delivery of Mulga Rock, as well as an established exploration team that can unlock considerable value at Alligator River. The Merger provides Vimy Shareholders the opportunity to share in the expected significant benefits of being part of a larger, geographically diverse Merged Group, with the expertise to develop the full portfolio of assets in the near term."

Chris Salisbury - Non-Executive Chairman of Deep Yellow commented: "This Merger represents an outstanding opportunity for both companies. It combines the strengths of both companies into a merged group of global scale, with outstanding assets and importantly a team with a track record of execution. The resultant Merged Group is well positioned for future growth in a sector that requires further consolidation.

The strategic importance of a merger such as this cannot be underestimated. In a time where energy security is at the forefront of government thinking globally, the value of a well credentialled company with a diverse asset base, places this company in a strong position when compared to its peers. The Merger represents a first step in the consolidation of the uranium sector required to deliver long-term sustainable supply."

The Hon. Cheryl Edwardes AM - Non-Executive Chairman of Vimy commented: "Vimy has made significant advancements in the development of Mulga Rock and I am proud of the team's achievement in reaching substantial commencement. As the company now moves to the next phase of development with a clearer pathway to production, I view this Merger as a key step to the successful development of the project. I encourage Vimy Shareholders to support the Merger and am excited about the future of what the Merged Group can deliver."

The board and senior management of the Merged Group will comprise representatives from Deep Yellow and Vimy which is detailed further in the Leadership and Integration section in the full announcement in the link below.

*To view tables and figures, please visit:
https://abnnewswire.net/lnk/5R0D253W

To view the Investor Presentation, please visit:
https://www.abnnewswire.net/lnk/T9T4BC31

About Deep Yellow Limited:

Deep Yellow Ltd. (ASX:DYL) (OTCMKTS:DYLLF) (Namibian Stock Exchange:DYL) is a differentiated, advanced uranium exploration company, in predevelopment phase, implementing a contrarian strategy to grow shareholder wealth. This strategy is founded upon growing the existing uranium resources across the Company's uranium projects in Namibia and the pursuit of accretive, counter-cyclical acquisitions to build a global, geographically diverse asset portfolio. A PFS has recently been completed on its Tumas Project in Namibia and a DFS commenced February 2021. The Company's cornerstone suite of projects in Namibia is situated within a top-ranked African mining destination in a jurisdiction that has a long, well-regarded history of safely and effectively developing and regulating its considerable uranium mining industry.

Source: Deep Yellow Ltd.



Contact:

John Borshoff Managing Director/CEO
T: +61-8-9286-6999
Email: john.borshoff@deepyellow.com.au
www.deepyellow.com.au