the merger synergies would be massive

the merger synergies would be massive


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Opex

Metro considers that the Merged Group could achieve cost savings through both the removal of duplication and enhanced operational
efficiency in key areas including:

• mining;
• transhipment;
• plant and equipment;
• labour; and
• logistics.

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Revenue

Metro believes the Merged Group will be able to increase the sale price per tonne achieved through:

• a single marketing structure;
• increased marketing relevance; and
• avoidance of Metro and Gulf, as standalone entities, having to compete with one another for product sales and therefore potentially
having to accept less favourable terms.

Metro also considers there to be opportunity to generate additional revenue by way of the removal of industry standard ‘buffer zones’
between respective standalone mining operations and tenement boundaries, which could enable increased ore reserves to be mined
and subsequently sold.

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Capex

Metro considers that the Merged Group could achieve reduced capital expenditure based on the removal of duplication in key areas including:

• barge loading facility and infrastructure;
• camp infrastructure;
• roads;
• communications systems;
• navigational aids and moorings; and
• mobilisation and insurance.

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Corporate

Metro believes that the Merged Group could benefit from reduced corporate expenses based on cost savings being achieved through
the removal of duplication, particularly as a result of:

• consolidated offices;
• a single board and management team; and
• the removal of duplicated administrative, taxation, legal and regulatory costs.

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Pre-development

Metro believes that the Merged Group could benefit from reduced pre-development expenditure through the removal of duplicated costs in key areas including:

• detailed engineering design work;
• establishment of internal systems and procedures;
• establishment of indigenous workforce participation and training; and
• environmental bonding due to a reduced operational footprint.