Larvotto Resources (ASX:LRV) entered into a binding scheme implementation deed to acquire all the shares of Hammer Metals (ASX:HMX) through a scheme of arrangement, according to a Thursday filing with the Australian bourse.

Hammer Metals shareholders will receive one new Larvotto share for every 22 Hammer shares held at the scheme record date, the filing said.

After implementation of the scheme, Larvotto shareholders and Hammer Metals shareholders are expected to own about 92.7% and 7.3%, respectively, of the combined entity.

The board of Hammer Metals unanimously recommended that shareholders vote in favor of the scheme, provided there is no superior proposal and the independent expert continues to conclude that the scheme is in the best interest of shareholders, per the filing.