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October 30, 2025 7:30 AM EDT | Source: Aurania Resources Ltd.

Toronto, Ontario–(Newsfile Corp. – October 30, 2025) – Aurania Resources Ltd. (TSXV: ARU) (OTCQB: AUIAF) (FSE: 20Q) (“Aurania” or the “Company”) provides a detailed summary of recognized areas of enhanced prospectivity on its Cutucu Project in southeastern Ecuador amidst changing political conditions in the country. The Company also confirms its focus on gold and strategic metals projects in Europe and other opportunities abroad.

Highlights:

• Since 2017, through diligent exploration using modern methods, the Company has discovered several highly prospective gold and copper exploration targets in the Cutucu region in southeastern Ecuador
• Led to the area by in-depth research of the legendarily rich gold mines of the “Lost Cities” of the Cutucu Cordillera over ten years of archival investigation, the Company determined that significant gold potential existed in the area
• Several “blind” epithermal gold targets, similar to the those that led to the discovery of the world-class Fruta del Norte gold deposit in southern Ecuador, have been delineated in the region, including Crunchy Hill, Kuri-Yawi and others
• Below epithermal targets, several potentially significant porphyry copper targets have been identified using newly reprocessed MobileMT geophysical data
• Sediment-hosted style copper mineralization, like that of the very large and high-grade Central African Copper Belt, has been identified at the 14 km-long Tsenken prospect
• Due to the evolving political situation and challenging business conditions for exploration companies in Ecuador, the Company has chosen to suspend all activities and take a “wait and see” approach
• The Company remains optimistic about its strategy to focus its efforts on projects for gold and strategic metals in Europe, along with potential opportunities elsewhere

When the Company acquired its initial 42 mineral concessions in the Cutucu region from Dr. Keith Barron in 2017, little was known of the geologic potential of the area since the centuries-old activities of the Conquistadors. The Shuar people, who historically inhabited the Cutucu region, did not traditionally engage in gold mining before the arrival of the Spanish. Aurania initiated modern exploration in the area, including an airborne Mobile MagnetoTellurics (MobileMT) geophysical survey in 2021. The data from that survey was reprocessed using new techniques in 2024 and 2025, revealing highly prospective new anomalies at the Awacha target (see press release dated June 27, 2025). While the state of knowledge of these areas was very preliminary in nature in 2021, now, with the benefit of hindsight from the new data acquired utilizing new technologies, age-dating, geological mapping and sampling over the last four years, a much more coherent picture has emerged. In addition, much information has been released in the public filings of Lundin Gold and Solaris from the adjacent and contiguous Cordillera del Condor, immediately south of Aurania’s block of concessions, providing further geological context for Aurania’s target areas.

Geological Context of Aurania’s Cutucu Project

The Cordillera de Cutucu and the Cordillera del Condor are part of a Jurassic back-arc rift system which extends roughly north-south through the whole of Ecuador. In the two Cordilleras, the fault system which demarcated the Jurassic rift basins was later reactivated and reversed in the Tertiary, forming the height-of-land characteristic of the Cordilleras. The mineralizing systems were then unroofed by erosion and exposed. In the case of the Condor, the erosion and uplift have removed several kilometres of sedimentary cover, exposing many copper porphyry systems and generating large areas of placer gold mineralization where epithermal vein systems have been entirely eroded away. In the Cutucu, the sedimentary cover over the mineralizing systems remains largely intact, so that the very tops of epithermal systems comprising hotspring sinters and siliceous terraces are preserved; the main body of the epithermal systems, as well as likely porphyry systems, remain preserved at depth. Additionally, the Cutucu shows abundant evidence that the fault basins contained playa lakes that evaporated to dryness, depositing thick layers of salt and gypsum. Conditions became favourable for the mobilization of copper and silver in saline fluids from volcanic rocks into shales and sandstones. This combination of unique geological conditions deposited and preserved extensive sheets of copper-silver mineralization in sediments, akin to Kamoa-Kakula, Dzezkazgan, and the Kupferschiefer. To date, this type of sediment-hosted style copper mineralization remains untested by drilling.

Blind Deposit Exploration

In the Cutucu, the porphyry and epithermal systems outcrop rather poorly or not at all. Their presence is not obvious but is revealed by geophysics and geochemistry. The world-class Fruta del Norte (FDN) gold-silver deposit, approximately 100 km to the south in the more deeply eroded Condor, was fortuitously preserved in a down-dropped graben block and covered by a Cretaceous sandstone which protected it from erosion. This was a “blind discovery” since there was very little gold on the surface. Its discovery by Aurania’s predecessor company Aurelian Resources, founded by Dr. Barron, came through the application of geochemical sampling for pathfinder-type elements, i.e., other metals which occur in gold systems but are much more abundant and more easily detected than gold itself. Early application of this methodology in the Cutucu led Aurania to the discovery of Crunchy Hill, Kuri-Yawi and other epithermal prospects. Actively artisanal-mined gold alluvials at Patuca, just outside the Aurania concession block, were determined to be derived from eroded early Cretaceous paleoplacers; in other words, the placer gold accumulations were more or less coincident in time with the epithermal vein system formation some 230 million years ago. This suggests that at least some of the sinter systems spread out over 30 kilometres within the Aurania claims could host another bonanza-grade type FDN.

Prospective Graben Settings

Intensive geological mapping has shown there are at least two, and possibly three, down-dropped grabens arrayed north-south through the Project. These became apparent after very careful reconnaissance mapping and reinterpretation of the biostratigraphy of the fossil endowment. Grabens form through extensional forces in the earth that pull apart the rocks horizontally. The central block will fall vertically into the space created and a deep canyon may result. The extensional spreading allows intrusion of porphyry-producing magmas, producing hot hydrothermal fluids that can pond in the dilatant zones: grabens are recognized as one of the most productive mineralizing environments.

Aurania Among First Industry Users of MobileMT

At the time of the initial MobileMt survey, Electromagnetic (EM) data inversion was performed using a one-dimensional (1D) algorithm. In recent years, EM inversion technology has significantly improved, particularly for areas with rugged terrain. As a result, Aurania recommissioned Expert Geophysics Surveys Inc. to reprocess the 2021 MobileMT data using the latest 2D inversion technology. The 2.5D inversion code that was applied is more objective and comprehensive than the previous 1D technology, as it considers the actual topography of the area being investigated, yielding robust lateral and vertical resolution, resulting in more accurate mapping of the subsurface conductivity, which may be related to mineralization.

Aurania was one of the very first companies worldwide to adopt MobileMT, but there were few publicly-available examples to demonstrate the expected geophysical signature of porphyry deposits using the MobileMT method. For a “real world” test and ground truthing, Aurania had the contractors fly over the known Panantza and San Carlos porphyry copper bodies outside of our concessions. These were proven deposits with extensive drilling. The MobileMT results generated outstanding signatures, with close spatial correlation of the ore bodies with strongly anomalously geophysical signatures. Based on this test study we flew large portions of our project using the MobileMT method, yielding several anomalies. The mineralized area of the Panantza/San Carlos test grid had only minor topographic relief, however, unlike our area in the much more rugged Cutucu. The primitive 1-D data inversion available at the time was unable to correct for the more rugged terrain, and we later drilled some targets that subsequently proved to be spurious. We have great confidence in the improved 2.5-D reprocessing of our data to produce reliable results: the new processing method accounts for the more significant terrain correction, and the new anomalies agree well with known geology, other geophysics and the porphyry copper exploration model.

The Lost Cities Cutucu Project

Aurania’s Lost Cities Cutucu Project was an outgrowth of historical research in the Archive of the Indies, Seville, and the Vatican Library, which suggested that the rich gold mines of Logroño de Los Caballeros and Sevilla del Oro, active circa 1565-1605 were in the Cutucu Cordillera. The Company used an extremely innovative approach with Metron Inc. of Reston, Virginia, a company that uses Bayesian Theory in geo-location of lost objects, including downed aircraft. Metron successfully located Logroño, which is a large alluvial plain along the Rio Santiago, just off our concession block. This was confirmed by the recovery of large amounts of alluvial gold by our geologists. We believe that this gold deposit was in part fed from our property. Attempts to partner with the construction company owning the gold alluvial area have to date been unsuccessful. Sevilla del Oro remains “lost” but it is believed to be in the drainage basin of the Pastaza River and outside our concessions. Aurania can find no evidence of past mining activity on the copper-silver, and lead-zinc-silver showings on our concessions. Dr. Barron’s experience in Guatemala, Mexico and Colombia suggests that the Colonial Spanish would have sunk shafts and adits on any of these areas had they been known at that time. We believe that these are virgin areas. The road network detected on the concessions by LiDAR surveying is almost certainly pre-Colombian and could be many thousands of years old and related to the lost culture in the Upano Valley, north of Macas. It appears that the pre-Shuar inhabitants mined and transported salt along these roads.

Aurania’s Target Areas in the Cutucu

Awacha, Sunka, Kirus, Awacha Norte

These prospect areas were initially revealed from a 400 metre-spaced airborne magnetometer and radiometric survey carried out in 2017. To date, Awacha has been the focus of our exploration efforts, but all prospects remain undrilled. Awacha and Awacha North appear to be in an area of uplift where early Jurassic rock is at surface. These prospects do not outcrop well, being covered by a thin stratum of mudstone, which in the ravines is eroded away sufficiently to expose porphyry intrusives. In addition, stream sediment sampling produced wide anomalous areas of several kilometres extent where copper and molybdenum were elevated. At both Awacha and Awacha North, zones of classic-type QSP (quartz-sericite-pyrite) alteration and “D-type” mineralized veinlets with molybdenite and chalcopyrite are present. D-type veins are very distinctive with a medial septum of sulphide, only seen in magmatic systems like porphyries. Awacha has been mapped in detail using the Anaconda mapping method. The recasting of the MobileMT survey has shown possible presence of six discrete porphyry bodies (see press release dated June 27, 2025). Awacha North has been cursorily mapped but not explored with MobileMT. We believe that Awacha and Awacha Norte represent multiple potential Cu-Mo porphyry bodies in a cluster, much like Solaris’ Warintza area, located south of Aurania’s concessions. Sunka and Kirus areas have yielded porphyry-style mineralization but have not been mapped in detail.

Crunchy Hill, Kuri-Yawi, Apai, Kuripan etc.

This collection of targets has high potential for epithermal-type gold-silver veining. These targets were discovered fortuitously very early in Aurania’s exploration efforts in the area, near the paved road where excellent access facilitated sampling. Apart from Crunchy Hill, all contain siliceous hotspring sinter on the surface, with evidence of reeds and other plants entombed in the splash zone of geysers. Very distinctive “geyserite” has also been found. This is a rock of solidified tiny spheres of quartz that represent sand grains on which silica nucleated as they were tumbled in the convecting hotspring. Hotspring-type rocks are located immediately above the ore zone at FDN, and Aurania staff were considerably encouraged by their discovery. Epithermal banded veins have been encountered by drilling, but fluid inclusion paleothermometry indicated that trapping temperatures were low, though salinities high. This means we were drilling on the periphery of the systems or not deep enough where the mineralizing fluids had already deposited their metals and were cooling. Only determined and persevering exploration with the drill will guarantee discovery. The results of an Induced Polarization (IP) Survey were ambivalent. Recasting of the MobileMT over Kuri-Yawi, however, strongly suggests two areas of potential sulphide flooding related to epithermal processes, as well as a deeper zone that bears the signature of a buried porphyry body. The Crunchy Hill area has not been covered by MobileMT. Crunchy Hill is a zone of disseminated sulphide with minor epithermal veining, which is enriched in the pathfinder elements Ag, As, Mn, Sb, Se, Tl, and Hg. Further geophysical surveys and a drilling campaign are required.

Tsenken

Tsenken was a wholly unexpected target area. Early in the exploration, the field assistants returned from the field with specimens over half a metre in size and more than 50 kg weight of significant amounts of chalcocite (a copper-rich (80% Cu) sulphide mineral) in bedded shales and sandstones. This sediment-hosted style of high-grade copper-silver mineralization, common to the large and high-grade copper deposits of Central Africa and the Kupferschiefer, was previously unrecognized in Ecuador and represent a compelling new exploration target. Informed by our early version of the MobileMT over this area we drilled several targets that unfortunately turned out to be duds. The problem was a misinterpretation of the sedimentary stratigraphy in this area, which was only sorted out by Professor Gregor Borg and Consultant Cristian Vallejo after a number of holes had been drilled. These sorts of copper deposits occur in areas of maximum fluid flow where there are favourable and reactive host rocks. By initiating a serious study of analogues from Ivanhoe Mines’ Kamoa-Kakula Deposit in the Central African Copper Belt, we were very excited to discover a large arcuate zone of high conductivity that parallels the surface trace of a major fault and subcropping Santiago Formation for 14 kilometres. The Santiago is a pyritic carbonaceous mudstone unit which could be an analogue to the chemically reactive pyritic diamictite that hosts most of the copper at Kamoa-Kakula. The coincidence of a strongly copper-mineralized rock indicating the presence of an effective mineralizing system, subsurface conductivity anomaly associated with a known fault/plumbing system and receptive host stratigraphy makes Tsenken highly prospective. This target remains undrilled.

Tiria-Shimpia

The Tiria-Shimpia zone appears to be localized along the east side of a graben fault and is hosted by limestone. The mineralization consists of semi-massive and vein-hosted Zn-Pb-Ag-Ba-bearing minerals and could represent the distal expression of the Tsenken copper-silver system. Extending for over nine kilometres and only partly covered by the MobileMT survey, it has been explored with four drill holes, all of which encountered mineralization.

Tatasham

The Tatasham target corresponds to a magnetic low lying within a major magnetic high anomaly. This magnetic low is interpreted as a classic de-magnetization of the rock by hydrothermal alteration related to the core of a porphyry system. The Anaconda mapping conducted in the area confirmed the presence of an intensive hydrothermal alteration, which justified a scout drilling campaign in 2023. The third drill hole intersected a thick silicified zone interpreted as the distal portion of an epithermal system at the same stratigraphic level as the sinter horizon. This indicates that we are in the upper level of the epithermal-porphyry system with the Tatasham prospect representing an epithermal target likely overlying a porphyry system at depth. Follow-up field verification confirmed the presence of sinters and extensive hydrothermal breccias. The thickness of the near-surface silicified system is comparable to that of Fruta del Norte and is situated within a small graben of similar age. Additional surface exploration is warranted to delineate the sinter zone and define targets for the next phase of drilling.

Conclusion

During the last two years, Aurania has engaged with four major companies in discussions of potential collaboration. In each case, the due diligence phase has taken more than six months. Two field visits were made, and a third was cancelled due to the assassination of a political candidate in the lead-up to elections. In each case, Aurania was praised for choosing to keep the large landholding intact, maximizing the chances for discovery, and for the diligent exploration work and positive engagement with the Shuar stakeholder community in Ecuador. Though the exploration market appears to be improving due to rising metal prices, junior explorers, particularly in greenfield areas, still struggle to raise adequate project funding. Aurania’s technical team are convinced that the Cutucu land package is one of the last areas left of significant mineral potential in the South American Cordillera that may have the potential to yield several new mines. Pioneering is not easy, nor does it yield the quick results preferred by investors and other stakeholders. It requires patience and perseverance, but the rewards can be spectacular.

Current Situation in Ecuador and Recently Imposed Mining Service Fee

As announced in our press releases July 28, 2025 and June 11, 2025, the Company has been assessed a $24.1 million USD mining service fee (the “TASA”) annually by the Government of Ecuador, ostensibly to fight illegal mining in the country. This is an industry-wide fee and is assessed by area under concessions. Aurania has no illegal mining on the concessions; nevertheless, the demand still stands. Comments have appeared in the Mining Journal, Bloomberg and Forbes regarding the potential damage the TASA would cause to the exploration industry in Ecuador and to date, we are aware of seven Constitutional Challenges that have been brought about, questioning its legality.

The recent initiatives presented by President Noboa have triggered conflict with the Court and widespread social unrest in Ecuador. This has resulted in clashes, nationwide protests, road closures, direct attacks on the President, and significant disruptions across multiple regions. Given the current circumstances, the Company has chosen to suspend all activity in Ecuador and take a “wait and see” attitude. In the meantime, the Company remains optimistic about its strategy to focus its efforts on projects for gold and strategic metals in Europe, along with potential opportunities elsewhere.

Qualified Persons:

The geological information contained in this news release has been verified and approved by Aurania’s VP Exploration, Mr. Jean-Paul Pallier, MSc. Mr. Pallier is a designated EurGeol by the European Federation of Geologists and a Qualified Person as defined by National Instrument 43-101, Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators.

About Aurania

Aurania is a mineral exploration company engaged in the identification, evaluation, acquisition, and exploration of mineral property interests, with a focus on precious metals and copper in South America and critical energy and precious metals in Europe.

Information on Aurania and technical reports are available at www.aurania.com and www.sedarplus.ca, as well as on Facebook at https://www.facebook.com/auranialtd/, Twitter at https://twitter.com/auranialtd, and LinkedIn at https://www.linkedin.com/company/aurania-resources-ltd-.

For further information, please contact:

Carolyn Muir VP Corporate Development & Investor Relations Aurania Resources Ltd. (416) 367-3200 carolyn.muir@aurania.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

This news release contains forward-looking information as such term is defined in applicable securities laws, which relate to future events or future performance and reflect management’s current expectations and assumptions. The forward-looking information includes: that the company is focused on gold and strategic metals projects in Europe and other opportunities abroad, the possibility that at least some of the Aurania sinter systems spread out over 30 kilometres could host another bonanza-grade type FDN, that Aurania’s technical team are convinced that the Cutucu land package is one of the last areas left of significant mineral potential in the South American Cordillera that may have the potential to yield up several new mines, Aurania’s objectives, goals or future plans, statements, exploration results, potential mineralization, the tonnage and grade of mineralization which has the potential for economic extraction and processing, the merits and effectiveness of known process and recovery methods, the corporation’s portfolio, treasury, management team and enhanced capital markets profile, the estimation of mineral resources, exploration, timing of the commencement of operations, the commencement of any drill program and estimates of market conditions. Such forward-looking statements reflect management’s current beliefs and are based on assumptions made by and information currently available to Aurania, including the assumption that, there will be no material adverse change in metal prices, all necessary consents, licenses, permits and approvals will be obtained, including various local government licenses and the market. Investors are cautioned that these forward-looking statements are neither promises nor guarantees and are subject to risks and uncertainties that may cause future results to differ materially from those expected. Risk factors that could cause actual results to differ materially from the results expressed or implied by the forward-looking information include, among other things: failure to identify mineral resources; failure to convert estimated mineral resources to reserves; the inability to complete a feasibility study which recommends a production decision; the preliminary nature of metallurgical test results; the inability to recover and process mineralization using known mining methods; the presence of deleterious mineralization or the inability to process mineralization in an environmentally acceptable manner; commodity prices, supply chain disruptions, restrictions on labour and workplace attendance and local and international travel; a failure to obtain or delays in obtaining the required regulatory licenses, permits, approvals and consents; an inability to access financing as needed; an inability to fund or extend the payment of Ecuador mineral concession fees which are due and payable and could result in the forfeiture of such mineral concessions; an inability to fund the administrative fees imposed by the Ecuadorian Control and Regulation Agency (ARCOM for its Spanish acronym) on the mining sector which could render the Company insolvent; a general economic downturn, a volatile stock price, labour strikes, political unrest, changes in the mining regulatory regime governing Aurania; a failure to comply with environmental regulations; a weakening of market and industry reliance on precious metals and base metals; and those risks set out in the Company’s public documents filed on SEDAR+. Aurania cautions the reader that the above list of risk factors is not exhaustive. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

SOURCE: Aurania Resources Ltd.

The Federal Reserve lowered interest rates for the second time this year on Wednesday, continuing its effort to stabilize the labor market amid rising unemployment concerns and an ongoing government data blackout.

Policymakers voted to reduce the benchmark federal funds rate by another quarter percentage point, setting a new range between 3.75% and 4% — the lowest level in three years. The move reflects the Fed’s cautious approach to balancing slowing job growth, stubborn inflation, and a murky economic outlook made worse by the shutdown of key government agencies.

For the first time in modern history, the Fed made a rate decision without access to a full month of official employment and inflation data. The lack of reliable government reports has complicated policymakers’ efforts to gauge the true health of the U.S. economy, particularly as layoffs from major employers like Amazon and Target signal that labor market conditions may be weakening.

The central bank began easing policy last month after private-sector data showed hiring had slowed to its weakest pace since 2010. Recent updates from payroll processors have indicated a slight rebound in hiring, though overall employment growth remains tepid. Without consistent data, the Fed is navigating largely in the dark, weighing the need to support jobs while keeping inflation contained.

Inflation and Tariffs Create Conflicting Signals

Inflation has cooled modestly in recent months, according to private data, but underlying price pressures remain. Businesses have managed to absorb higher costs tied to new tariffs rather than pass them directly to consumers, though economists warn that could change if trade tensions persist.

President Trump’s tariff policies, alongside shifting trade dynamics with China, continue to inject volatility into markets. The upcoming meeting between Trump and Chinese President Xi Jinping in South Korea could shape the trajectory of global trade and influence inflation expectations heading into 2026.

Despite these uncertainties, the Fed is signaling that its priority remains preventing a sharp rise in unemployment. The central bank’s rate cuts are designed to lower borrowing costs for businesses and consumers, encourage investment, and keep economic momentum intact as trade and political risks intensify.

In a separate announcement, the Fed confirmed that its three-year effort to reduce the size of its balance sheet will conclude by December 1. The portfolio — which peaked near $9 trillion in 2022 after the pandemic-era stimulus — has been trimmed to roughly $6.6 trillion, a level officials now view as closer to normal.

The move signals confidence that the financial system no longer requires extraordinary liquidity support, even as rate cuts continue.

For investors, the Fed’s latest cut underscores a cautious but proactive stance in navigating a fragile economic environment. Lower interest rates generally benefit equities, particularly small-cap stocks, which tend to be more sensitive to borrowing costs and domestic growth trends.

If the easing cycle continues, small-cap companies could see improved access to capital and renewed investor interest, especially in sectors like industrials, consumer goods, and technology — areas that often rebound first when monetary policy shifts dovish.

Still, with limited visibility into key economic indicators, volatility is likely to remain elevated in the weeks ahead. Market participants will be watching closely for updates on inflation, trade policy, and the labor market once government reporting resumes.

Eli Lilly and Company’s agreement to acquire Adverum Biotechnologies marks another major move in the race to dominate the emerging field of genetic medicine. The deal, announced Friday, highlights the pharmaceutical giant’s commitment to expanding its gene therapy portfolio and targeting treatments that address chronic, age-related diseases — a market expected to grow rapidly over the next decade.

Under the terms of the agreement, Lilly will acquire all outstanding shares of Adverum for $3.56 per share in cash, plus a contingent value right (CVR) worth up to an additional $8.91 per share, depending on key regulatory and sales milestones. This brings the potential total value of the transaction to $12.47 per share. The deal is expected to close by the fourth quarter of 2025, pending shareholder and regulatory approval.

Adverum’s leading asset, Ixo-vec, is a one-time intravitreal gene therapy in Phase 3 development for wet age-related macular degeneration (wAMD) — a progressive retinal condition that affects millions of older adults worldwide. The therapy aims to reduce the need for repeated eye injections by delivering long-term aflibercept production directly within the eye. If successful, Ixo-vec could reshape the standard of care for patients who currently rely on frequent treatments to preserve vision.

The acquisition aligns with Lilly’s broader strategy of integrating genetic medicine technologies into its drug discovery pipeline. The company has already made significant investments in obesity, diabetes, and Alzheimer’s research, and sees gene therapy as a natural extension of that work. By adding Adverum’s proprietary intravitreal delivery platform and its promising ocular gene therapy programs, Lilly gains both innovation and market access in a field expected to see accelerating demand.

From a financial standpoint, the structure of the deal — combining upfront cash with milestone-based CVRs — reflects a balanced approach to managing risk while still rewarding Adverum shareholders if Ixo-vec achieves commercial success. The program’s FDA Fast Track and RMAT designations, as well as PRIME status from the European Medicines Agency, signal strong regulatory support and potential for expedited approval.

The move also underscores a broader trend across the biotech industry: large-cap pharmaceutical companies are increasingly acquiring smaller clinical-stage firms to secure access to cutting-edge gene therapy pipelines. For small-cap investors, this represents an important theme — as emerging biotech companies with late-stage assets become prime takeover targets in the current market cycle.

Gene therapy remains one of the most promising and competitive frontiers in modern medicine. While challenges such as manufacturing scale and long-term efficacy remain, the science continues to mature rapidly. Lilly’s acquisition of Adverum not only validates the commercial potential of ocular gene therapies but also signals continued confidence in the sector’s long-term growth trajectory.

If Ixo-vec succeeds, it could open the door to broader applications of gene therapy across multiple chronic conditions — reinforcing the idea that “one and done” treatments may soon become reality for millions of patients worldwide.

The Federal Reserve’s latest signal toward additional rate cuts has broad implications for equity markets, but small-cap stocks stand to benefit most prominently. With an estimated $7 trillion in cash and cash-equivalents—often referred to as “dry powder”—sitting on the sidelines, investors are preparing to put capital to work. Much of this capital is housed within private equity funds, institutional investors, and large asset managers, which are all seeking stronger returns as yields on cash and Treasuries decline in a falling-rate environment.

When interest rates fall, sitting on cash becomes less attractive. Investors, pressed to generate higher ROI, begin reallocating money into equities, private deals, and higher-growth opportunities. For small-cap companies, this creates a powerful tailwind. Not only do they benefit from increased investor flows, but they also operate with greater sensitivity to financing conditions. Lower borrowing costs can dramatically improve the profitability outlook for smaller firms, which often rely more heavily on debt and capital markets to fund growth compared to large caps.

M&A Activity and Its Ripple Effects

A large portion of sidelined capital resides within private equity funds, which thrive in environments where acquisition financing is cheaper. Rate cuts reduce the cost of leverage, making buyouts more attractive. The $7 trillion pool of global dry powder is a firehose of liquidity ready to be deployed into merger-and-acquisition deals.

This matters for small caps because acquisition premiums drive valuations higher across the board. As private equity firms, corporations, and even larger small-cap peers target acquisitions, multiples expand—not just for the companies being acquired, but for entire industries as investors speculate on who might be next. This “M&A halo effect” has historically been a significant driver of outperformance in the small-cap space.

Why the Russell 2000 Benefits Disproportionately

The Russell 2000, the most widely watched U.S. small-cap index, tends to be more cyclical and more domestic-focused than large-cap benchmarks. Rate-sensitive sectors such as financials, industrials, and consumer discretionary make up a larger share of its composition. This means the Russell 2000 is positioned to benefit more directly from looser monetary policy than the mega-cap dominated S&P 500 or Nasdaq.

Moreover, small-cap valuations remain historically discounted relative to large caps. The valuation gap, widened after years of tech-driven outperformance at the top end of the market, could narrow sharply as investors re-risk portfolios in search of higher growth potential. History shows that during periods of monetary easing, small caps have often outperformed, fueled by capital inflows, improved earnings prospects, and heightened M&A activity.

The Bottom Line

The confluence of Federal Reserve rate cuts, a massive capital overhang waiting to be deployed, and the natural sensitivity of small-cap companies to interest rate changes sets the stage for a potential rally in the Russell 2000 and broader small-cap landscape. Lower yields make cash less productive, driving investors toward equities. Private equity firms flush with capital will likely target acquisitions, boosting market-wide valuations. And small-cap companies, historically more nimble and growth-oriented, stand to capture the bulk of these benefits.

For investors focused on the small-cap arena, the coming months may present an exceptional entry point. The combination of monetary easing and $7 trillion in sidelined capital seeking higher returns could ignite the small-cap rally that many have been waiting for.

Tamboran Resources Corporation (NYSE: TBN, ASX: TBN) has agreed to buy Falcon Oil & Gas Ltd. (TSXV: FO, AIM: FOG) in a transaction that will combine roughly 2.9 million net prospective acres across the Beetaloo Basin and create a pro-forma company with a market capitalization above US$500 million. The deal, structured as a Plan of Arrangement, will see Tamboran issue about 6.54 million Tamboran shares and pay US$23.7 million in cash for Falcon’s subsidiaries. Falcon shareholders are expected to own about 26.8% of the enlarged business upon closing, which is targeted for the first quarter of 2026 subject to regulatory and shareholder approvals.

Strategically, the acquisition strengthens Tamboran’s working interest in the Phase 2 Development Area to roughly 80.6% ahead of an ongoing farmout process. The transaction also aligns Tamboran more closely with Daly Waters Energy across key EPs and brings a larger contiguous footprint across the Beetaloo depocenter. On a per-acre basis, the deal values Falcon’s assets at roughly US$169 per acre — slightly below Tamboran’s implied acreage valuation — making the transaction accretive on a headline basis.

What makes the tie-up significant for the wider industry is scale. Unconventional gas projects are capital intensive and require sizeable, contiguous acreage to attract majors and strategic farm-in partners. By consolidating acreage and increasing operator control over Phase 2, Tamboran is positioning itself to negotiate more favorable farmout terms, accelerate pilot development, and de-risk timelines for potential midstream and liquefaction projects, including the company’s proposed NTLNG concept at Middle Arm.

The move reflects broader sector trends in Australia and global upstream markets. As investors and partners demand clearer development pathways and lower execution risk, consolidation has become a common strategy: fewer operators with larger positions can pool technical expertise, reduce unit costs, and present more bankable project packages to capital providers. That dynamic is especially relevant in basins like Beetaloo where regulatory scrutiny, infrastructure needs and environmental permitting add layers of complexity that favor scale and experienced operators.

The acquisition also has ripple effects for service providers, regional supply chains and local communities. Larger, multi-phase development programs typically generate sustained demand for drilling services, completions crews, pipelines and processing contractors — supporting jobs and local procurement over longer horizons than single-well campaigns. Conversely, the sector remains sensitive to commodity price swings and permitting timelines; successful farmouts and access to capital remain critical near-term catalysts.

From a capital markets perspective, the consolidation could enhance Tamboran’s visibility with institutional investors and potential partners by simplifying ownership of the basin’s core acreage. That said, the deal requires customary approvals — including court and shareholder votes and Australian regulatory consents — and outcomes of the farmout process will be key to demonstrating commercial viability and securing further investment.

In short, the Tamboran-Falcon combination is more than a portfolio tweak: it is a strategic consolidation aimed at creating the scale and operating leverage needed to move the Beetaloo from pilot stage toward commercial development. For market watchers, the next milestones to monitor are the farmout announcements, regulatory clearances, and any near-term pilot results that will determine whether the enlarged Tamboran can translate acreage control into funded development.

Tuesday, September 30, 2025

Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Activist Investor. Randian Capital, part of the “retail activist” group behind the sharp rise in Opendoor Technologies (OPEN) stock from less than a $1 mid-summer to around $8.20 today, released on social media platform X a turnaround proposal for The ONE Group. In a nutshell, the plan consists of Refocus the Portfolio, Revitalize the Brand, Strengthen Operations, and Capital Discipline & Growth. Radian sees a path to a $10+ stock over the next 12-18 months. STKS shares rose over 26% yesterday on the news.

Refocus & Revitalize. Randian calls for ONE Group to refocus solely on its Benihana concept, selling off all other concepts. The activist investor believes the STK concept alone could be worth more than the current market cap. Randian suggests rebranding as Benihana Group and changing the stock symbol. Revitalization by elevating the dining experience and engaging with cultural icons, among other changes.

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Integral Ad Science (Nasdaq: IAS), a global leader in media measurement and optimization, announced Wednesday that it has entered into a definitive agreement to be acquired by Novacap, a North American private equity firm, in a transaction valued at approximately $1.9 billion.

Under the deal, Novacap will purchase all outstanding shares of IAS for $10.30 per share in cash, representing a roughly 22% premium over the company’s closing price on September 23. The agreement, which has been unanimously approved by IAS’s board of directors, is expected to close before the end of 2025, pending regulatory approvals.

Once finalized, IAS will become a privately held company and its shares will no longer trade on public markets. Current shareholder Vista Equity Partners, which played a significant role in expanding IAS’s AI-powered platform and customer base, will exit its investment upon completion of the deal.

For IAS, the acquisition represents a chance to accelerate its growth and innovation strategy in digital media quality. CEO Lisa Utzschneider highlighted the move as a milestone that will provide the company with the resources and flexibility to expand its AI-first measurement and optimization platform.

“Our mission has always been to set the global benchmark for trust and transparency in digital media quality,” Utzschneider said in a statement. “With Novacap’s support, we’ll be able to further scale our platform and deliver even more value to advertisers, publishers, and media partners.”

Novacap, which manages more than $10 billion in assets, sees IAS as a category leader with significant potential. Samuel Nasso, a partner at the firm, said Novacap plans to work closely with IAS leadership to accelerate innovation and strengthen its solutions for global brands and publishers.

The transaction is not subject to any financing conditions, and a majority of IAS shareholders have already approved the deal through written consent. Financial advisory roles were split, with Jefferies advising IAS and Evercore advising Novacap. Legal counsel was provided by Kirkland & Ellis for IAS and Willkie Farr & Gallagher for Novacap.

Founded in 2009, IAS has established itself as a trusted player in the digital advertising ecosystem, providing data and tools to ensure ads are viewable, brand-safe, and optimized for performance. By joining forces with Novacap, the company is expected to sharpen its competitive edge and continue expanding its role as a benchmark for media transparency in the rapidly evolving adtech landscape.

If the transaction closes on schedule, IAS will continue operating under its existing name and brand while shifting into private ownership under Novacap.

U.S. equities extended their gains on Thursday, with the Russell 2000 index of small-cap stocks taking center stage as investors embraced the Federal Reserve’s latest policy shift. The move comes just a day after the central bank announced its first interest-rate cut of 2025, a decision that has sparked optimism about economic growth and reignited appetite for smaller, more domestically focused companies.

The Russell 2000 soared more than 2% to an intraday record, positioning itself for its first all-time closing high since November 2021. This surge has placed the index firmly ahead of its large-cap peers, with the S&P 500 climbing 0.5% and the Nasdaq Composite adding 1.1%. The Dow Jones Industrial Average rose 120 points, or 0.3%.

For small-cap investors, the Fed’s move signals a potential turning point. Unlike cash-rich technology giants that can weather higher borrowing costs, small- and mid-cap companies often rely heavily on external financing to support operations and growth. Lower interest rates reduce that burden, freeing up capital for expansion and making smaller firms more attractive to investors.

Beyond the macroeconomic boost, market sentiment has improved notably since the Fed’s policy shift. The American Association of Individual Investors (AAII) reported a surge in bullish sentiment this week, with 41.7% of respondents now optimistic on the short-term outlook for stocks, up sharply from 28% the previous week. While bearish views remain elevated, the optimism highlights growing confidence that the Fed’s pivot will continue to lift equities.

The Russell’s outperformance is also being fueled by a broadening of market participation. For much of the past year, the rally in U.S. equities has been concentrated in mega-cap technology names driven by artificial intelligence enthusiasm. The rate cut has shifted attention to smaller companies that had largely lagged during the high-rate environment. With valuations still relatively attractive compared to large-cap counterparts, the Russell’s resurgence is attracting both institutional and retail inflows.

Meanwhile, the broader market rally was supported by strength in both traditional and technology sectors. Notably, Intel surged more than 25% after Nvidia announced a $5 billion investment to co-develop chips for data centers and PCs, sending Nvidia shares up more than 3%. While big tech continues to contribute, the spotlight remains firmly on the Russell’s record-setting move.

Looking ahead, investors will closely watch whether the Fed follows through with its projection of two additional rate cuts before year-end. Continued monetary easing could further unlock momentum for small-cap stocks, though analysts caution that too much stimulus could risk overheating both markets and the broader economy.

For now, however, the Russell 2000 has emerged as the clear winner of the Fed’s rate shift—marking a powerful comeback for small-cap investors after nearly four years without a record high.