Dundee Precious Metals (DPM) has agreed to acquire all issued shares of Adriatic Metals in a transaction valued at approximately $1.3bn (C$1.77bn).
The transaction is expected to enhance DPM’s production capacity and extend its mineral reserve life through the 100% acquisition of the Vareš silver-lead-zinc-gold mine in Bosnia and Herzegovina.
Shareholders of Adriatic Metals will receive 0.1590 of a DPM common share and 93 pence in cash for each Adriatic share under the acquisition.
The transaction implies a value of £2.68 ($3.62) per Adriatic share and A$5.56 ($3.62) per CHESS Depository Interest, based on the exchange rates as of 11 June 2025.
The scheme of arrangement under the UK Companies Act 2006 will see DPM shareholders owning approximately 75% and former Adriatic Shareholders around 25% of the enlarged issued share capital post-transaction.
This strategic move is anticipated to generate enhanced cash flow and provide significant cash generation to fund DPM’s growth and capital returns programme.
Dundee Precious Metals president and CEO David Rae said: “Adding Adriatic’s Vareš operation to our strong asset portfolio creates a premier mining business with a peer-leading growth profile, high-quality development and exploration pipeline and a robust platform to deliver above-average returns.
“Vareš is a logical fit with our portfolio, as it significantly increases DPM’s mine life while adding near-term production growth, a highly prospective land package and cash flow diversification. We are well-positioned to leverage our expertise in underground mining, our regional presence, successful track record of building and ramping up new mines, as well as our strong financial position to further optimise the operation and realise Vareš’ full value potential, based on our analysis.”
Vareš is an underground mine with an offsite processing facility located near Sarajevo and has been ramping up production since its first concentrate production in 2024.
The operation, with a 15-year initial operating life and a 4,400-hectare land package, is expected to bolster DPM’s production to as much as 425,000 gold equivalent ounces by 2027.
The independent technical report by SRK Consulting (UK), effective as of 1 April 2025, confirms Vareš’s potential with an all-in sustaining cost of $893/oz of gold equivalent.
Adriatic Metals managing director and CEO Laura Tyler said: “Vareš remains firmly on track to become a low-cost precious metal producer, underpinned by a long mine life, a high-grade deposit and strong exploration potential.
“What makes Vareš so exciting is that it is at the beginning of its journey, with significant growth potential ahead. This transaction brings together complementary strengths to create a dynamic and diversified mining company with meaningful scale. We see clear synergies between the asset portfolios of DPM and Adriatic, supported by DPM’s strong financial capacity and proven operational expertise.”
The completion of the acquisition is subject to several conditions including approvals from Adriatic Shareholders, the court, the Toronto Stock Exchange and the Bosnian Competition Council.
The transaction is expected to become effective no later than 31 December 2025.
In September last year, DPM sold its Tsumeb smelter in Namibia to a subsidiary of China’s Sinomine Resource Group for $20m.
