Australian merger will create mid-tier gold producer

Australia's Southern Cross Goldfields (ASX: SXG) and Polymetals Mining (ASX: PLY) plan to merge, reports the Sydney Morning Herald.

The two miners describe the resulting entity as a significant diversified gold company with the ability to join the ranks of mid-tier producers in the near term.

According to Proactive Investors Australia, the merger's end result will be a $30-million market capitalized company with combined cash of $13 million and debt of about $7 million.

The new company's resource will be 1.7 million gold ounces,with an ore reserve of 254,000 gold ounces, plus an emerging production profile of up to 69,000 ounces per year via the Marda and Mt Boppy projects. Production is expected to start next year.