#United States #Contango ORE #Fairbanks #Merger #Dolly Varden Silver

Major Merger in the Mining Sector

On December 8, 2025, Contango ORE, Inc. and Dolly Varden Silver Corporation revealed their plans for a merger, a move intended to fortify their positions in the North American precious metals market. This strategic merger aims to create a combined entity, tentatively named Contango Silver & Gold Inc., designed to leverage both companies' assets and expertise.

Details of the Merger Agreement

The merger will function on a basis referred to as a 'merger-of-equals', indicating that both parties will be viewed on equal footing concerning ownership and operational control. Under the arrangement agreement, shareholders from both companies will each retain roughly 50% ownership of the newly formed entity, maximizing shareholder interests.

Rick Van Nieuwenhuyse, the CEO of Contango, noted the synergies between the operations of both companies. The merger is anticipated to provide a unique opportunity for investors interested in a well-funded North American portfolio. This portfolio features the robust cash-generating Manh Choh gold mine in Alaska alongside numerous silver and gold projects based in British Columbia and Alaska.

Asset Overview

The potential merged entity will boast an impressive array of high-grade projects, including:

• - Manh Choh Gold Mine: One of the highest-grade open-pit gold mines globally, with an estimated reserve of approximately 8 grams of gold per tonne. This mine is managed in partnership with Kinross Gold Corporation and has demonstrated substantial cash flow.
• - Lucky Shot Mine: Located in Alaska, this site holds a significant indicated resource of gold at a high grade. This mine is fully permitted and undergoing exploration expansion with potential increases in gold yield anticipated.
• - Johnson Tract: With diverse resources comprising gold, silver, zinc, and copper, this project shows great promise. An initial assessment revealed an impressive net present value, emphasizing its viability for development.
• - Kitsault Valley: Containing a vast resource of silver and gold, this project also presents substantial exploration opportunities within the renowned Golden Triangle region of British Columbia.

Strategic Advantages of the Merger

The merger comes with several anticipated strategic benefits:

• - Resource Synergy: The combined companies will streamline exploration and development efforts, focusing on both established production sites and those aimed at future high-grade discoveries.
• - Financial Strength: Boasting over $100 million in combined cash, only $15 million in debt, and strong cash flow from ongoing production, the new company is positioned to finance its expansion easily.
• - Market Positioning: With a projected market capitalization of around $812 million, the merged company will enjoy increased legitimacy and visibility on capital markets, providing better access to investment opportunities and shareholder returns.

Industry Insights

Analysts have suggested that this merger, combining two operations with complementary resources, positions the new company as a competitive player in the North American mining sector. The focus is sharply aligned on developing low-capex, direct shipping ore (DSO) projects, thus offering a sustainable production model that minimizes environmental impact while maximizing profit.

Furthermore, the merger also enhances exploration possibilities across both companies’ existing and future mining prospects. The shared expertise and commitment of the management teams from both sides add further credibility to potential success, ensuring efficient resource management.

Next Steps in the Process

Shareholders from both Contango and Dolly Varden will vote on this merger at meetings scheduled for February 2026. Both management teams anticipate solid backing due to significant shareholder support that has already been established. The transaction is subject to regulatory and exchange approvals before completion.

In conclusion, the merger between Contango ORE and Dolly Varden Silver represents a pivotal step towards creating a formidable North American silver and gold producer. It signals a significant consolidation within the mining industry, emphasizing the increasing importance placed on resource efficiency and strategic growth in today's market.