I will be your coordinator for today's event. Please note this conference is being recorded, and for the duration of the call, your lines will be on listen only. However, you will have the opportunity to ask questions at the end of the presentation. This can be done by pressing star one on your telephone keypad to register your question at any time. If at any point you require assistance, please press star zero and you'll be connected to an operator. I'll now hand you over to your host, Sébastien de Montessus, CEO of Endeavour Mining, and Richard Young, CEO of Teranga Gold, to begin today's conference. Thank you.
Good morning, everyone. Thank you, operator. My name is Sébastien de Montessus, President and CEO of Endeavour Mining. Welcome, thank you very much for joining us today as we announce the combination with Teranga to create a new top 10 senior gold producer. We are, with Richard, incredibly excited about this transaction as it makes sense on so many levels and offers a strong opportunity for re-rating for both sets of shareholders. I'm happy to be joined by Richard Young, CEO of Teranga, as together we will outline why this is such a compelling transaction. Afterwards, we'll be happy to take any questions you may have. Before we start, I'd like to draw your attention to the disclaimer on slide two. Let's now turn to slide three, which provides a high-level summary of the transaction rationale.
We believe that this transaction follows the successful M&A trend we're currently seeing across the industry. There are many examples where good companies not necessarily needing to do M&A have come together and have immediately created value for their shareholders. We believe that this transaction will do the same. First, and of utmost importance, this combination has a very compelling industrial logic. It combines two high-quality West African asset portfolios at a time when both companies have recently completed investment phases and are now generating healthy cash flows. As such, the future looks bright for both companies and even brighter together. Secondly, as a result of this combination, we will create a new top 10 senior gold producer with very strong attributes. Production will be diversified across several flagship mines and across three countries.
We will also have an industry-leading growth pipeline and arguably the largest and highest quality exploration portfolio in West Africa. We are also doing this transaction because we see strong re-rating potential. In fact, Richard and I agree that while both our respective companies have strong re-rating potential on a standalone basis, we see an even larger upside through this combination, and we see this as a catalyst to accelerate our re-ratings for both sets of shareholders. The combined company will have among the most attractive trading multiples compared to its senior gold peer group. In addition, we believe that the re-rating would be supported by enhanced capital market profile. As you might have seen, the other large news of the day is our intent to list on the London Stock Exchange as a premium issuer. Yes, premium and not standard, as some other companies recently announced.
This is a big distinguishing factor as it will create the largest premium-listed pure gold producer in London with a target to be included in the FTSE 100. This should further help our combined re-rating due to inflow demand from indexation. Of course, the company would have strong attributes with strong cash flow generation and a robust balance sheet capable of sustaining an attractive dividend yield. Before we dive into the presentation further, Richard, would you like to say a few words?
Well, Sébastien, thank you. Yes, I would, and good day to everyone. Today is a milestone day for Teranga. As Sébastien has outlined and will outline as he goes through the presentation, our merger with Endeavour creates what we believe, on the Teranga side, is a best-in-class senior gold producer. When I look at the merger through the lens of Teranga shareholders, there's a lot to like. The new Senior Gold Producer will have things that Teranga shareholders are looking for and expect when they invest in Teranga, and that is among the lowest all-in sustaining costs of any senior gold company, as well as Sébastien noted, the best growth profile. What's new for Teranga shareholders is a more diversified production base with six core mines across three countries, a stronger balance sheet, an attractive dividend, and the scale and liquidity required to attract generalist investors.
Our Board believes, as Sébastien mentioned, that Endeavour targeting a premium listing on the London Stock Exchange, they will likely become a FTSE 100 listing, and there's a lot of follow-on index buying that comes from that that will truly help with the re-rate. Similar to our SEMAFO acquisition, as Sébastien will lay out, there are very real opportunities to achieve meaningful financial, operating, and capital synergies with this combination. Over the last three years, Teranga stock has been a top performer. This combination provides a modest premium, more importantly, offers participation in what we believe is the best-in-class senior gold producer trading at very attractive valuation. I'm proud of the Teranga team and what we've accomplished together. We've taken Teranga from a single asset producer with one standalone mine in Senegal, to a low-cost, mid-tier gold producer over the past two years.
Today, Sabodala-Massawa is a tier 1 asset, high grade, low cost, with a significant potential to materially increase resources and reserves over the next 12-24 months. Our second mine, Wahgnion, has far surpassed expectations, and with the recent revision to our mine plan, will continue to outperform for many years. We expect these two mines to produce more than 500,000 ounces of gold per year at very low cost. That's for at least the next five years. Our exploration pipeline includes Golden Hill and Afema, two rapidly advancing projects with all indications that they will be future mines. As we have built our asset base, we have made a name for ourselves as responsible miners with a strong social license in each of the three countries that we operate in.
At this point, I'd like to take a moment to thank our host governments in West Africa for supporting us as we work to build our company and achieve our vision. We believe the company is in very good hands with Séb and his team, who share our vision of what a responsible miner is. I would also like to thank all of our shareholders for their support, and a specific call-out to our largest shareholder, David Mimran. David had a strong belief in our mid-tier ambition from day one, and without him, we would not be where we are today. Finally, I'd like to thank all of our employees who comprise the Teranga family for their commitment and hard work. With that, I'll turn the call back over to Séb .
Thanks, Richard. Diving into the presentation on slide four, we see the exciting company this will create. All our combined assets are located within West Africa, clearly our DNA is West Africa, supporting the compelling industrial logic of this transaction. We will enhance our strategic position in the region with an extensive presence across the entirety of the West African Birimian Greenstone Belt with six core mines across three countries. This solidifies our leading position in the mining-friendly jurisdictions of Côte d'Ivoire and Burkina Faso, now in Senegal too. As I've mentioned, we will be a top 10 global gold producer with an average annual production of over 1.5 million ounces of gold all-in sustaining cost among the lowest in the industry. For those Endeavour Mining shareholders who may not be too familiar with the Teranga Gold Corporation assets, let me take you through their portfolio on slide five.
We are confident these assets will integrate well with our existing West African operating platform and believe that this combination represents an opportunity to capture unique synergies. What stands out is that each asset brings its own significant contribution to the overall portfolio with an attractive strategic rationale. First, the jewel in the crown, Sabodala-Massawa mining complex in Senegal. Teranga did an amazing job consolidating the Massawa project with Sabodala earlier this year. The combined operation has the potential to become Endeavour's highest quality mine, with above 400,000 ounce of annual production, low cost, long mine life, and significant reserves. This asset also provide us with a new operating platform in Senegal, which is a very stable, mining friendly jurisdiction.
Moving across to Burkina Faso, we are adding the Wahgnion Mine, which Teranga successfully built in commission in 2019, and which produces approximately 150,000 ounce at an all-in sustaining cost of roughly $900. This asset will be a strong cash generator. As we saw with the SEMAFO transition, we expect to capture significant local synergies by integrating Wahgnion into our well-established West African platform, and of course, we like the exploration upside. Patrick's going to be happy and have fun. The developments made at Sabodala-Massawa and Wahgnion over the past 12 months have been game changing for Teranga. This was shown by a 700% increase in operating cash flow to $75.6 million in Q3 compared to last year, supported, of course, with higher gold price. The third asset, also in Burkina Faso, is the Golden Hill project, which is located within trucking distance of our Houndé mine.
The project already has 800,000 ounces of M&I resources and 700,000 ounces of inferred resources, which we will aim to grow further. Given its close proximity to our Houndé plant, we see potential to consider the development of this project as a satellite to Houndé, which will significantly lower capital cost and potentially accelerate the development timeline. Finally, not on the page, but making headlines more and more at Teranga is the Afema joint venture in Côte d'Ivoire, where an initial resource is expected to be announced in the coming months. Turning to slide six, you see our familiar bubble chart, which shows how our various assets fit into our portfolio. Put simply, our strategy has been to move assets into the bottom right box, which is above 10 years mine life and below $850 all-in sustaining cost.
As you can see, Sabodala-Massawa is well-positioned, and with the expansion plan next year, it will clearly become our highest quality asset. If we look at the pie charts on the right, you can see that the combined entity has production, which will be well diversified across three countries with resources and reserves further diversified across four countries, given the strong project pipeline. Over to the page on slide seven. We believe this transaction has the potential to create significant synergies across the corporate, regional, and mine site level as we leverage our West African operating model and integration platform. Following the acquisition of SEMAFO and as part of the broader integration process, we undertook a comprehensive evaluation of our organizational structure and made a number of changes to ensure we are well set up for future growth.
At the corporate level, we aim to leverage our recent experience with the SEMAFO acquisition to deliver significant synergies. In total, we were able to identify more than $35 million in annual synergies from the SEMAFO transaction, and we are confident we can create additional value for shareholders through our combination with Teranga. As I mentioned, the integration team is already in place and will be able to quickly transition the people and operations from Teranga to the Endeavour management model, which, as Richard said, is a very similar model. We're very confident on the ability to integrate. We also have a clear path in sight for G&A cost savings, which we expect to start coming through in the first year post-close.
At the regional and country level, we will be able to draw on the benefits of being the largest gold producer in each of Senegal, Burkina Faso, and Côte d'Ivoire, where we have strong community and government relations, which are beneficial to all our stakeholders. Our existing platform in Burkina Faso will enable a rapid integration of Wahgnion and Golden Hill. Finally, at the mine site level, we believe we can achieve significant synergies in areas such as optimization of mining fleets, processing flow sheet upgrades, procurement and supply chains, and leveraging of our centralized support services. In addition, there is potential to realize significant synergies by operating Golden Hill as a Houndé satellite deposit. What is most interesting for me is looking at the map on the right. The Endeavour, SEMAFO, and Teranga transaction has consolidated the highly prospective Houndé belt.
Our footprint now spans three mines, two projects, and the largest exploration tenement on this belt. With an annual production of over 600,000 ounces coming from this belt, we believe that this will be comparable to other world-class belts. On slide eight, you can see that this transaction will leapfrog us into the senior category with total gold production above 1.5 million ounces per year. While we are not doing this combination solely for the purpose of size, this added scale does factor in the screening of large global investment funds. As a larger company, we expect to see improved access to capital and enhanced trading liquidity as we become more investable for both generalist and resource-focused funds alike around the world. Moving to slide nine. You can see our position relative to the senior producer peer group.
With all-in sustaining costs below $900 per ounce, I would say maybe even $850, we are very well positioned among the peer group. This metric is very important for both Teranga and Endeavour. Both companies have dedicated the last several years to building a robust business that operates at low cost. As such, it was important for both of us to not dilute ourselves by combining with higher cost assets to maintain a high-quality portfolio. Turning to slide 10. Many of you will be familiar with our portfolio of assets, which will be bolstered by the addition of the Teranga assets. As a combined entity, we have strong exposure across the full mining cycle. Starting on the left, I believe we have some of the most exciting greenfield projects in West Africa, which gives us significant optionality when looking at future growth.
We have more than 10 significant greenfield projects where we see promising potential for additional discoveries. On the development front, we already have Fetekro and Kalana. Fetekro has had some significant recent success with an increase in the resource to 2.5 million ounces and an acceleration of the pre-feasibility study to early 2021. We can also add now the Golden Hill project and the Afema exploration to Bantou and Nabanga, which we acquired from SEMAFO earlier this year. Looking at our producing mines, we have six core producing operations and eight mines in total. Sabodala-Massawa, plus Ity and Houndé from the heart of the combined business with Boungou, Mana and Wahgnion, all representing additional opportunities for mines in Endeavour's target box.
This expanded optionality across our portfolio gives us enormous flexibility for the future, and each of these projects will compete for capital within our disciplined approach around capital allocation. Moving to slide 11. You see here that the combined business would have a strong balance sheet compared to other senior producers. On the right-hand side of the slide, you can see we're very well positioned among our peer group based on net debt to trailing 12 months EBITDA. We will also be moving to the right as we continue to generate significant cash. This robust balance sheet and strong cash flow provide a strong ability to pay an attractive dividend yield going forward.
As you noted, we declared our first dividend last week, and this combination provides further confidence in the sustainability of our ability to fund dividends. In fact, we expect to build a strong net cash position in 2021 while paying dividends and growing organically, which would give us further ability to increase our shareholder returns program as part of our capital allocation framework. As part of the transaction, we are also pleased to have the continued strong support of our major shareholder, La Mancha, Naguib Sawiris, who has committed to invest $200 million in support of the combination. In addition, we will be undertaking a comprehensive refinancing of the combined entity's debt package. The main benefit here is generating on the order of $40 million per year in savings by replacing high-cost financings and less favorable offtake agreements, which are currently on the Teranga balance sheet.
We will also have a financing structure that is more flexible than the existing arrangements and reflective of our positioning as a new Senior Producer. As we move to the next slide, I will note that Endeavour recently declared its first dividend as a key step on the path to a sustainable dividend policy. Our first dividend of $60 million, representing approximately a 1.6% yield on an annual basis, will be payable to shareholders during Q1, based on the record date to be set before the transaction closes. We want to ensure that our long-term shareholders who have stood with us through the last several years of growth and deleveraging are rewarded for their patience.
Following this first dividend, we expect to declare dividends on a semi-annual basis, with the goal of maintaining a similar annual dividend yield until we have reached a net cash position of $250 million, which in fact might be as early as Q2. At that time, we will reassess our capital allocation priorities and consider further augmenting our shareholder return program against other potential uses of capital. On the right-hand side of the page, you can see that our first dividend positions us very competitively against our new senior producer peer group. Being a dividend payer opens us up to an entirely new class of shareholders for whom this is critical consideration. As we mentioned at the start of the presentation, the combined company will be well-positioned amongst its peers with a great opportunity for a rerating.
On slide 13, you can see how we stack up against the senior gold producer, where we are clearly valued at a discount based on price to net asset value, enterprise value to EBITDA, and free cash flow yield. I hope you will agree that there is significant potential for us to move up this chart as we deliver on our commitments and demonstrate the additional value that we can create. Moving to slide 14, as I mentioned earlier, the other important news of the day is our intent to list on the London Stock Exchange as a premium issuer following the completion of the transaction. You can see how our production compares to the LSE-listed peer group. With the removal of Randgold, the LSE has relatively limited option for those seeking significant diversified gold production exposure.
On completion of the listing process, we will be the largest premium London-listed pure gold producer and the second overall, and we further believe that we will be well-positioned for inclusion in the FTSE 100 Index. We expect indexation to add strong incremental shareholder demand, therefore, further supporting our rerating potential. The next item to note is the great support that we have from a group of core shareholders, as shown on slide 15. On the Endeavour side, La Mancha has agreed to vote its current approximately 24% position in favor of the transaction. On the Teranga side, both Tablo and Barrick have agreed to support the transaction. Between the two companies, they control approximately 33% of the voting shares of Teranga, and they have committed to vote in favor of the transaction at the upcoming Teranga shareholder meeting.
Both Tablo and Barrick bring extensive know-how operating in Africa with David Mimran, owner of Tablo, an experienced and well-connected businessman in both Senegal and Côte d'Ivoire. Overall, we're very pleased to have all three as supporters of the combined company. Obviously, as you have seen, both boards have also unanimously been supporting this transaction. On slide 16, we have set out how the transaction creates benefits for both sets of shareholders. For Endeavour, in addition to the assets which we've addressed at length, there is a strong economic rationale to pursue this acquisition, which I hope to have made clear throughout this presentation. The transaction is immediately accretive on a NAV per share basis. On cash flow per share and earnings per share metrics, it is neutral over the next two years and then significantly accretive beginning 2023, when the Massawa expansion is fully realized.
All of this accretion occurs without accounting for the impact of the synergies we expect to realize. Endeavour shareholders will also benefit from a more diversified entity to support ongoing dividend payments moving forward. Teranga shareholders, as Richard explained earlier, can expect to realize an immediate premium and lock in their strong share price appreciation since the Massawa acquisition. The combined entity will be a larger, more diversified, and operationally and financially de-risked company with a proven track record of project development and a clear route to further value upside. The transaction also significantly enhances growth optionality for Teranga shareholders within an expanded portfolio and a stronger balance sheet. Let me take a moment to summarize the benefits for both companies. This combination creates a top 10 global gold producer with over 1.5 million ounces of annual gold production at low all-in sustaining costs.
Both companies will contribute in a balanced manner to the combined entity's value. The combined entity will have strong cash flow generation capability and a strong balance sheet with the capacity to simultaneously fund growth and pay dividends while building a strong net cash position in 2021. We will also have the scale and liquidity to attract generalist investors with a combined market cap of over $6 billion and an attractive valuation relative to the peer group. Both group of shareholders have the potential to benefit from a re-rating driven by attractive valuation metrics underpinned by a sustainable dividend policy, an LSE listing, and potential inclusion in the FTSE 100. Finally, we can reiterate that we have strong support from three cornerstone investors who can all contribute their extensive relationship and experience operating in Africa.
Clearly, the rationale for this transaction is compelling, and the pathway for shareholder value creation we've outlined is achievable. In closing, let me summarize our combined vision for the company that will become after this transaction, as shown on slide 17. We want to create a resilient and sustainable business for the long term, reward our loyal shareholders while attracting new ones, and remain the partner of choice in the communities where we operate. To that end, we believe that this combination supports this objective, given how compelling it is. Richard and I are excited to think about what we are able to do together, delivering on our shared ambition as we embark on this exciting journey. Richard and I will be now happy to take any questions you may have. Operator?
As a reminder. Of course. Thank you. As a reminder, if you'd like to ask a question or make a contribution on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. Please ensure your line remains unmuted locally. You'll be advised when to ask your question. So again, that's star one. The first question comes from the line of Raj Ray from BMO Capital Markets. Please go ahead.
Thank you, operator. My congrats, Sébastien and Richard, on a great transaction. My first question is on the due diligence, mutual due diligence period with the joint news release early last week and given the COVID pandemic, how long would the due diligence for and how much of that were you able to accomplish?
Sure, Raj. Both companies have been doing due diligence together since April, following shortly after the announcement on the SEMAFO transaction. In the case of Endeavour, we were pretty familiar with Massawa, given that we did due diligence when it was a Randgold asset. We knew well the asset. It's been, I would say, with Richard's team it's been nearly 6 months that we've been working on this and making it. It's not something that happened yesterday. We've been carefully monitoring the steps done between Teranga and Massawa through their transaction. Despite COVID-19, we've been able to do a first wave of different site visits during the summer. In fact, in August. We've been able to do a second wave of visits over the last three, four weeks which have been successful on both sides. Extensive work has been done redoing reserves and so on.
We had a very strong level of confidence on both sides. It was a bit unfortunate that the leak was made last week. The leak came where we were finalizing terms, we were very close to the finish line, therefore the leak didn't impact the way we were progressing towards this transaction. Richard, you may want to comment also on your side.
Thank you, Sébastien, and Raj, that's a great question. What we did for Endeavour's principal assets, we rebuilt the resource and reserve models. We reviewed all metallurgy and test results. We reviewed all the costs. For some of the other assets, it wasn't as detailed, but it was a thorough review, and we're very comfortable and excited with those assets. We think that, in particular, the core assets have tremendous growth opportunities.
Yeah. The other thing I would add, Raj, is this is a combination between two companies that know each other very well. There is not that many strong and good operators in West Africa. Richard and I and our teams are seeing each other on a very frequent basis. Obviously, we feel that we have a very similar culture. If you take, for example, Paul Day, the current GM at Wahgnion, we are used to work with him. Very comfortable. Very comfortable also with the experienced team that Richard has at Sabodala-Massawa. We were extremely comfortable in proceeding from a technical standpoint. The genesis of this, beyond the regular discussions that Richard and I have been having is, I've been pushing about 18 months ago for Teranga and Massawa to really combine, because Massawa, on a standalone basis was not making the numbers in order to progress.
Therefore, Richard did the right move in combining Sabodala with Massawa, and it became extremely logical for both of us to move forward on this transaction.
Thank you, Sébastien and Richard. My second question is for you, Sébastien, on your portfolio. You got eight operating assets, among them Agbaou and Karma are short mine life. You've got two great development assets with SEMAFO and Teranga, the Golden Hill that has good synergies with the Houndé. If you look at your current portfolio, do you think this is the optimal portfolio or do you see potential for addition of more assets in that?
Sure. What I think over the three, four last years, we've been active in managing the portfolio, making sure that we do focus management on the right assets and in particular assets which are able to generate the right level of returns that we're expecting for our shareholders. As you pointed out, and I think in the presentation, we clearly outlined that we had six core assets and Agbaou and Karma are lagging a bit behind, in particular in terms of mine lives and cost. I wouldn't be surprised if over the next few months is once the closing of this transaction, if we start optimizing the portfolio around those assets.
Okay. Thanks, Sébastien. Just two more questions on that side, if I may. First up on the re-domicile, sorry, the LSE listing, premium listing. Beyond the re-domiciling, is there any other conditions that you need to meet to do that? Are you looking to maintain the premium listing and the TSX composite listing at the same time? The second question is on the dividend timing, just back to when you expect to pay that out. Will it be paid out before the transaction closes? Yeah, that's it from me.
Sure. Well, first of all, what's important is, we view this listing as complementary to the Canadian listing. We're not expecting any impact for our Canadian and North American investors that are through the TSX. The timing for the U.K. listing is obviously post-closing of this transaction. I would anticipate that it's probably going to take about 6 months post-closing to prepare for this premium listing. I would target around end of Q2, beginning of Q3 for the LSE listing. Becoming premium, there is different ways in becoming premium. Yeah, we're confident that we can meet those criteria, and again, meeting those criteria without any particular impact for Canada.
Okay, thank you. Secondly, on the dividends timing.
On the dividends, as you saw as part of our Q3, Endeavour standalone has decided to move forward with a $60 million dividend, representing about 1.6% dividend yield. This will be paid prior to the closing of the transaction to Endeavour shareholders. Somehow around beginning of January, beginning mid-January. Then what we say with Richard is that the combined group will have a very strong balance sheet with very limited net debt upon closing, in particular with the $200 million capital injection from La Mancha. We are in a position, given the strong cash flow and the low cost of the combined group, that we're extremely confident in generating strong cash flow going forward and to maintain a minimum dividend of at least 1.6% yield going forward.
The objective is to reach, as quick as possible, a net cash balance of $250 million for the company. Once we've reached that net cash balance, to progressively increase the dividend yield based on the cash flow generated. At this stage, in terms of timing, what we said is that the next dividends will be paid on a semi-annual basis. We would expect the combined group to benefit from a first semi-annual dividend as part of our Q2 results, and then the second one as part of our year-end results 2021.
Okay, Sébastien. Thanks a lot. That's great.
Thanks, Raj.
Thank you. The next question comes from the line of Fahad Tariq from Credit Suisse. Please go ahead.
Hi, good morning. Thanks for taking my questions. I have two. I'll ask them one by one. As you think about your development pipeline, I know previously, the thinking was in early 2022, there would be an investment decision on either Fetekro or Kalana. Has that timing changed now because obviously you're a larger company now, so you've already achieved the growth, but also maybe you need more time to look at the entire portfolio and think about what assets make sense in terms of development? Anything on the timing would be helpful. Thanks.
Thanks, Fahad. No changes on that front. Obviously, Sabodala-Massawa project is progressing. There are some CapEx in 2021, and then the bigger ones will come in 2022 and 2023. On our side for new projects, as we said, nothing before end of 2021, beginning of 2022. We'll continue to progress both feasibility studies for Fetekro and Kalana. Only one will be launched in 2022 based on merits and returns. There is no changes on that front. What we like with this transaction is basically being able to increase the pipeline for future projects. We still have the Bantou project that we got through the SEMAFO acquisitions that we need to progress in terms of drilling. We have this Golden Hill project that we need to further drill, and that will nicely potentially fit as a satellite to Houndé.
That's another one. It's really going to be about the amazing exploration portfolio that this combined group is getting, both on the core assets. You know, we still have a lot of exploration potential on our core assets, Houndé and Ity. We see amazing potential on Massawa and on Wahgnion, which is great. We've got a big number of targets, including the exciting Afema, but not to mention all the exploration also from the SEMAFO portfolio, including the ones at Mana and Boungou. A lot to be done, and which is why with Richard, we're confident that this combined group has then all the right features going forward to create its organic growth without having to move into other M&A.
That's clear. My only other question was, I think previously you had mentioned that some of the countries in which you operate in West Africa, they are part of a similar economic bloc in terms of setting the taxation or royalty structure. Is Senegal also part of that West African bloc, or is it a separate kind of regulatory jurisdiction with separate royalties and separate taxation? Thanks.
Yes, exactly, Fahad. Senegal is part of the same West African Economic and Monetary Union, as Côte d'Ivoire and Burkina Faso and Mali and Niger. This is part also of the attractiveness. Using the same currency, having the same central bank, and therefore aligning progressively both in terms of taxes, but also in terms of mining codes. This is why this portfolio and this combination between the two companies is so natural and so attractive.
Okay, great. That's it for me. Thank you.
Thank you, Fahad.
Thank you. The next question comes from the line of Jonathan Guy from Berenberg. Please go ahead.
Hi, guys. Thanks very much for taking the question, and congratulations on the transaction. Just looking forward, you'll have 1.5 million ounce a year as production. You've flagged as a couple of assets that become non-core, and you've got some great projects in Fetekro and Golden Hill, which you can bring into the portfolio. From this point forward, is the ambition to maintain at 1.5 million ounces, or do you see yourself ultimately being a 2 million ounce producer? What are your thoughts on further M&As? Is this it for the next couple of years, or are you still looking?
Thanks, Jonathan. 1.5 million ounces, we said in the past that being between one to 1.5 was probably the right spot, simply because this is a tough business where you need to replace depletion every year, and you're talking about reserves. With a combined group at 1.5 million ounces, we're going to have to replace about 1.5 million ounces of reserves, which is probably about 3 million ounces of resources. Which, thanks to the quality of the portfolio and the exploration portfolio in particular, we believe this is feasible. There is no intention to go beyond the 2 million ounces. We have a lot of projects, so we'll see how those different projects factor in progressively into the pipeline. Yeah, I think we're very happy. We have now the right, I would say, portfolio, diversified geographically.
Think that was the missing point following the SEMAFO transaction, which is some concerns by some investors on being too exposed to Burkina, which we don't feel because we are extremely happy in Burkina Faso. Obviously, this combination with Teranga gives a much broader geographical exposure. Highly focused geographically, but at the same time diversified over three countries. A strong pipeline, both in terms of project and exploration. We've got everything we need going forward to grow organically.
Look, just to ask, you guys, you've got La Mancha, you've got Tablo, you've got Barrick, and obviously you guys, the management team. There's four people with fairly or four groups with fairly significant experience in the industry there. Are you all in absolute agreement about the strategy, or do you expect Barrick or Tablo to exit at some point? How will the strategy change as these two other groups have come into the tent?
Well, the way I will look at it is, and based on the support agreements that we got from all set of shareholders, is that they are all happy for this combination to happen, and they are all happy with the potential rerating that we would be expecting from this combination. La Mancha and the G Mining Ventures will be about 19% at closing, following their $200 million top-up. 19% largest shareholder in the combined group. Tablo, David Mimran, will be about 7% in the combined group, and Barrick about 4%. It's known that Barrick down the road will be selling progressively their stake. I don't think that their strategy is to keep investment in other gold mine companies. I know and believe that they want to continue to enjoy the rerating of this combination. I won't expect them to come out shortly. David Mimran is committed.
The Mimran family have been extremely successful operating in West Africa across different businesses, and in particular in Senegal and in Côte d'Ivoire. I do believe that David is also personally a friend, and he's extremely committed to see the success of this transaction and committed to the long term in seeing some strong value creation. We have a good core shareholders that are here for the long term, and in particular to support the rerating that we are expecting from this amazing combination.
Okay, thank you.
Sorry, Jonathan. Could I just add to that? I echo Sébastien's comments, but I think they need to be emphasized. As we moved being Teranga into that mid-tier status, there were a number of options for us, and options that would have included a larger upfront premium. Both David and Mark truly believed in what we're creating and the opportunity for a rerate. Of all the choices that we would have had, they were very strongly in favor of this. They believe in the combined entity, this new best-in-class senior gold stock that's being created. Not only are they happy, they fundamentally are very supportive and believe, to their core, in the rerate that the Endeavour shares are going to have over the next few years as we execute.
Thank you, Richard.
Sorry about that, Sébastien.
No. It was important to further give colors, so thanks, Richard.
Thank you. The next question comes from the line of Wayne Lam from RBC Capital Markets. Please go ahead.
Good morning, guys, and congratulations on the combination. I was just curious, are there any specific country-level approvals required for the transaction within the countries that you guys operate?
Thanks, Wayne. There is no regulatory requirements. Obviously we do have and entertain strong relationship with the host countries where we operate. Therefore, both Richard and I have been informing this morning each of the three key countries where we operate. We have strong relationship in Côte d'Ivoire and in Burkina. Richard may want to comment, but I've seen how strong also the relationship of Teranga in Senegal, where they are the largest gold producer. Richard?
Apologies, we lost Richard. He's trying to dial in now.
Okay, no problem. No particular requirements and strong relationship on both sides where we operate. Therefore both governments, three governments have been already informed and are supportive of this transaction.
Okay, great. Thanks. Then I'm just wondering if you could just walk us through some of the due diligence done on the refractory ore at Massawa. I understand the focus of the operations in the Endeavour portfolio has mostly been on oxide material. I'm just wondering the level of comfort with the Massawa asset.
Sure. Wayne, I think that we did a detailed due diligence on the Massawa asset when it was owned by Randgold. We're not discovering the refractory and the BIOX approach for optimizing recoveries at Massawa. On top of that, we've been extremely comfortable with the PFS and the studies that the Teranga management team have done, which was a very thorough and detailed analysis. We are looking forward to work with them on the next step, which is the feasibility study. In-house, we have some core competencies. If we take, for example, Mark Morcombe, our Chief Operating Officer, he was operating one of the biggest BIOX plant in Ghana. We have, here and there, some good competencies around BIOX. I truly believe that going forward, gold companies will have to get this strong expertise in refractory ore.
There are a lot of refractory ore across West Africa, and therefore this will become a core competence going forward for major companies.
Okay, perfect. That's all for me. Thank you.
Thanks, Wayne.
Thank you. The next question comes from the line of Anita Soni from CIBC World Markets. Please go ahead.
Good morning. Sébastien, can you tell me what you think has been the holdback for both Endeavour shares and Teranga shares, and what you think this combination will do in terms of actually getting you to rerate for both stocks?
Sure. I think Anita and Richard can probably complement on the Teranga side, but I think both companies have been investing a lot in building their mines. We went through construction of both Houndé and Ity, with strong leverage. We started deleveraging over the last 12 months and very successfully, I think, and very quickly, being able in less than a year after commissioning Ity and ramping up Ity, being able to be in a dividend position. We'll be net cash zero on a standalone basis at the end of the year, the combined group will be close to net cash zero on the closing date. I think the expectation is really through the cash flow generation that this combined group will be generating. I think if you take some analyst consensus, we're close to 17%-19% cash flow yield for the combined group.
Therefore, when you look on a cash flow per share, this group has truly a significant potential on upside. Richard?
Thank you, Sébastien. From the Teranga side, and I think for Teranga shareholders, we've acquired Massawa, and we've laid out, as Sébastien mentioned, the PFS. But again, they haven't really seen the benefit. We only hit commercial production for Massawa on September 1st. I think that with another quarter or two under our belt as Massawa delivers, I think you'll start to see that rerate as the market becomes comfortable with that integration, and we've already guided that Q4 will be a record quarter for us. Then, Sébastien mentioned the market is looking for us to deleverage. We had indicated on our third quarter conference call that on a standalone basis, we would be net cash by this time next year. I think as we move through the course of 2021, naturally we would see the rerate as we continue to execute.
On a combined basis, I think that when you look at our operating financial metrics, I think there's an entirely new level of rerate available to the combined entity as we're able to tap into larger general shareholders.
Okay, thank you for that. The second question I have is just to confirm with respect to the dividend. Going forward when you reassess it on a semi-annual basis, I guess that would be mid-year 2021. That would definitely apply to both the shareholders, the 1.6% yield that you had introduced before?
Yeah, exactly, Anita. What we say is minimum will be 1.6% on an annual basis going forward. If by that time we reach above $250 million net cash, then we will be from there increasing the dividend yield.
Okay. Just in terms of the team that's going to be left in place from Teranga, can we talk about who's going to be retained and who might no longer be with the firm in time?
Sure. The Endeavour executive team will remain in place. In addition, the objective is to complement our team with key senior managers from Teranga. I'd like, in fact, to take the opportunity, so thanks, Anita, for mentioning, to thank Richard in advance, who will be staying on for a few months during the transition period to allow maximizing the synergies and prepare for a strong value creation between the two companies.
That's it for my questions. I'll jump back in the queue. Thanks.
Thank you. The next question comes from the line of Don DeMarco from National Bank Financial. Please go ahead.
Well, thank you, operator. Congratulations, Sébastien, Richard. A couple questions. First off, previously you had mentioned that you were considering either a U.S. or a London listing. With the decision today about London, that's great. Is the U.S. listing off the table, or are you going to consider an ADR or some other means?
Sure, Don. Well, I think we were balancing between the two because there are some attractiveness on both sides. On a standalone basis, maybe given liquidity in the U.S., we were potentially heading to New York. The combined group, given that management is mostly based in London and that all our assets are in West Africa, and given our forecasted approach to increasing dividend yield in the future, thanks to the strong balance sheet and cash flow, we thought that this would be appealing for the London market. The combination having the ability to potentially become a FTSE 100 company makes it obviously even more attractive from an index tracker perspective. This is why we decided for London. We started in the background already to work, working on FPPP requirements and so on.
The objective, once the closing is done, is to head then quickly to this listing that we would anticipate to be around end of Q2.
Okay. Okay, great. Any U.S. ADR or something, that would be for any future discussion, but nothing at this point.
Yeah, exactly. If you take the Randgold model, it was basically a U.S.-listed FTSE 100 and ADRs.
This could be one option for us down the road once the London listing is achieved.
Okay. Thank you. Last question, great synergies on Golden Hill. What do you envision that would look like? Could you potentially expand the throughput at Houndé to have higher production, or would it be a supplement to extend the mine life?
Sure. Too early, I would say, Don, to say at this stage. What we like is the fact that there's currently about 8,000 ounces of indicated resources, 700,000 ounces of resources, inferred resources. The average grade is about 1.8. There are also some high-grade zone, so very easy to track and feed in the plant at Houndé. As part of the integration, the objective will be to design some of those strategic key decisions in order to recast life of mine plans and drilling priorities in order to move forward.
Okay, thank you for that. That's all for me.
Thank you. The next question comes from the line of Lawson Winder from BofA Securities. Please go ahead.
Hi, guys. Good morning, and afternoon, rather, to you, Sébastien. Exciting acquisition. Just two questions from me. One would be on, just looking back at SEMAFO, there was a bit of a surprise when the government of Canada did the national security review on the SEMAFO acquisition. Have you eliminated the possibility of that happening in this case, or is that still something that could happen?
Sure, Lawson. What I think the good news is that if Canada had national security questions, they were all answered during the SEMAFO process. We're not expecting any difficulties on that front. Nothing has changed. This transaction is basically reinforcing also some of the Canadian expertise that we will have going forward for the combined group. We're not anticipating big issues on that front.
Will there continue to be an office located in Canada? I think the original plan with SEMAFO was to keep their Montreal office.
No,
You're just thinking on that now?
There was no requirement to keep an office in Canada. We were interested, in fact, to keep some of the key teams, in particular, on the technical side from SEMAFO. This is why we kept an office in Montreal. The same way, and we've been discussing with Richard, we're not anticipating to close down tomorrow the Toronto office. There are some strong people that will be part of this transaction going forward. The reality is that our assets are all in West Africa, and what we want is people to bring their expertise, whether they are based in Australia, in Perth, in Paris, in London, in Montreal, or in Toronto. I don't really care, as long as it's the right quality and that they're bringing the right tools to our growth story. Yeah. Again, from a Canadian perspective and regulatory, not expecting any particular issues.
Okay. That's very helpful color. The second topic that I wanted to address was just on the path for Sabodala-Massawa going forward. There is still the feasibility study to do. You've indicated confidence in the work that's been done so far. Perhaps with some of the experience you have internally, for example, Mark working in BIOX, is there any thought to changing the process for handling the refractory ore going forward? Could we see any substantial changes such as that in the ultimate feasibility study? Also, what's the timing you're thinking on that feasibility study? Thanks so much.
Yeah. Lawson, not at all. I think we're very comfortable with the progress that the Teranga team have made on the PFS. They are going right now into, and Richard can comment after, but they are going into trade-off studies. Obviously, some of our team will be involved and review that and work closely with the Teranga team. Going forward, it's the same people that will be running this. Very confident in the way it's been handled so far and this will be a smooth integration within Endeavour. Richard, you want to comment further?
Yeah, Sébastien, I think you've covered it off. I think the key point is that the PFS was really a point-in-time flow sheet, and it's being optimized through, as Sébastien mentioned, the trade-off studies. They'll be done early in the second quarter, and at that point, the key decisions will be made on whatever flow sheet improvements are made, and the Endeavour team will be in place. As Sébastien mentioned, we've got a large group that we've brought together. Keep in mind that Teranga really has a small technical group. There's five or six of them. We've really leveraged off of, historically, some of the best people in the industry, as Sébastien mentioned, globally. Endeavour will be able to keep those people, those experts that have been doing all this work.
I don't think Endeavour's going to miss a beat on it, and we'll be able to make the final decision on what that flow sheet looks like, the sizing, come Q2.
Thank you very much, Richard. Thank you, Sébastien. I look forward to following this company going forward.
Thank you very much, Lawson.
Thank you. We have a follow-up question coming from the line of Anita Soni from CIBC World Markets. Please go ahead.
Hi. Sébastien, can you let us know if you've done any analysis on the cross-ownership between the two companies and how much overlap there is between them?
Thanks, Anita. We haven't, I think, in our slide deck. I can ask Martino or Trish to send you that over. There is about 35% cross-shareholding between, in particular, BlackRock, VanEck, and others.
All right. Thank you. Thanks.
Thank you. I will hand the call back to the speakers for any closing remarks.
Thank you, speaker. Again, I’d like to thank you all for attending this joint call with Richard. Wishing you all a nice day, and looking forward to present you some of the results once closing happened on this amazing company that we’re building with Richard. Thank you very much.
Thank you for joining today's call. You may now disconnect.