News Summary
The most recent release on December 23, 2025, is a year-end address from CEO Shawn Khunkhun. It characterizes 2025 as a “step change” year for Dolly Varden Silver (DV). The primary highlight is the December 8, 2025, announcement of a merger-of-equals with Contango ORE to create “Contango Silver & Gold Inc.” This merger combines DV’s high-grade Kitsault Valley assets with Contango’s producing Manh Choh mine in Alaska. The address also summarizes a massive 56,131-meter drill program that yielded exceptional results, including 1,422 g/t Ag over 21.7m at the Wolf Vein and 26.74 g/t Au over 14.76m at Homestake Silver. Financed with over C$63 million raised in 2025, the company ended the year with approximately C$60 million in cash.
Material Impact
The impact of the news is transformative.
– Strategic Shift: The company is successfully transitioning from a pure-play explorer to a mid-tier producer. By merging with Contango ORE, DV gains immediate exposure to gold production and cash flow from the Manh Choh mine (attributable production of 52,020 oz Au in the first 9 months of 2025).
– Asset Synergy: The merger creates a geographically consistent portfolio across Alaska and British Columbia. DV provides the “20-year plan” exploration upside to Contango’s “5-year plan” production.
– Market Profile: The combined entity, “MergeCo,” will have an estimated market cap of US$812 million (C$1.1 billion), significantly increasing liquidity and institutional appeal.
– Exploration Success: The 2025 drill results at the Homestake Silver deposit suggest a shift toward a gold-rich system at depth, potentially improving project economics given current gold prices.
Catalysts
– Shareholder Vote: Special meetings for both DV and Contango shareholders are expected in February 2026 to approve the merger.
– Regulatory Approvals: Success in obtaining British Columbia Supreme Court approval and exchange listings for the new entity.
– Closing of Merger: Anticipated for late February or early March 2026.
– Resource Update: Integration of the 56,000+ meters of 2025 drilling into an updated Mineral Resource Estimate (MRE) for the Kitsault Valley project.
– Manh Choh Performance: Continued quarterly cash distributions from the Manh Choh mine to fund development at Kitsault Valley.
Materiality Conclusion
The merger with Contango ORE is a material game-changer. It solves the primary risk for an exploration-stage company—the constant need for dilutive equity financing—by securing an internal cash flow stream to fund the development of the Kitsault Valley project. The combination of high-grade silver/gold exploration and immediate production is a rare model in the junior/mid-tier space.
