Open this photo in gallery: Gold bars stacked at the United States Mint in West Point, N.Y., in 2014. Gold miners Alkane Resources and Toronto-based Mandalay Resources announced a takeover by Alkane on Monday. They hope investors will reward the combined firm with a 'rerate,' as gold prices rise on investor uncertainty.Mike Groll/The Canadian Press Australia’s Alkane Resources Ltd. ALKEF is offering to buy Canadian gold company Mandalay Resources Corp. MND-T in an all-stock deal worth roughly US$358-million aimed at boosting liquidity and scale that will see the smaller company take over the bigger one. Despite record-high bullion prices, many gold miners continue to have difficulty attracting investors. That’s partly owing to the industry’s historic poor track record, but also the ease at which investors can gain exposure to gold through exchange-traded funds. Perth-based Alkane and Toronto-based Mandalay hope that by combining operations, investors will reward the combined company with a “rerate” – a higher stock market multiple. Alkane operates the Tomingley gold mine in New South Wales. Mandalay’s producing assets are the Costerfield gold-antimony mine in Australia and the Björkdal gold mine in Sweden. In a joint press release on Monday, both companies said that Mandalay investors will receive 7.875 Alkane shares for each unit held. The premium being paid is small, only 2 per cent compared to Mandalay’s Friday closing price. The transaction effectively amounts to a reverse takeover, as Alkane is the smaller company by market value, worth roughly US$301-million compared to Mandalay’s US$350-million. After the deal closes, Mandalay shareholders will own 55 per cent of the combined company and Alkane the rest. The deal will require a shareholder vote at both companies before it can proceed. At least two thirds of votes cast in favour of the transaction are needed at Mandalay. A simple majority of votes cast at Alkane is required to approve the issuance of stock to pay for the acquisition. Post-transaction, Mandalay chief operating officer Ryan Austerberry and Chris Davis, VP exploration, will join Alkane’s management team. Shares in both companies rose on Monday, with Alkane gaining 4 per cent in trading in Australia, and Mandalay up by 5 per cent in early trading on the Toronto Stock Exchange. Gold last week hit a new all-time high of around US$3,500 an ounce. Bullion tends to do better during times of great uncertainty, and has rocketed higher owing to the massive dislocation stemming from U.S. president Donald Trump’s global trade war. Deal-making amid the gold buying frenzy has taken off. Last week, Barrick announced the sale of its stake in the giant Donlin gold project for US$1-billion and Ross Beaty-backed Lumina Gold Corp. agreed to a $581-million acquisition by China’s CMOC Group Ltd.