Acquisition of Central Australia Rare Earths
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.
5 May 2017
Strategic Minerals plc
("Strategic Minerals" or the "Company" or "SML")
Acquisition of 100% of Central Australia Rare Earths Pty Ltd
Strategic Minerals PLC (AIM: SML; USOTC; SMCDY), the diversified mineral production and development company, is pleased to announce that Rarus Limited ("Rarus"), its joint venture partner in Central Australia Rare Earths Pty Ltd ("CARE"), has agreed to sell its remaining shares in CARE to SML for £522,500 to be provided by Rarus subscribing for 19,000,000 new shares in Strategic Minerals plc issued at £0.0275 per share. The transaction is to be completed prior to 1 June 2017.
While CARE will become a 100% subsidiary of SML, Andrew Spinks, the geologist associated with Rarus, has agreed to continued involvement in CARE's various projects through the provision of strategic professional advice, at market rates.
Shareholders are advised that Strategic Minerals Chairman, Alan Broome, is also a Non-Executive Director of Rarus and a director of CARE (representing SML's interests) and that, after making the Board of Strategic Minerals aware of the CARE opportunity, he excused himself from any further dealings with the acquisition.
Commenting, John Peters, Managing Director of Strategic Minerals, said:
"Under existing arrangements, SML was due to move to a 75% ownership of CARE. However, it has become clear that to fully explore the resource potential indicated in CARE's tenements, larger amounts of funding would be required.
While the profitability of operations at our Cobre plant in New Mexico, USA has provided SML the capacity to provide such funding, Rarus may have struggled to source suitable funding in the timeframe SML envisaged for the project. Accordingly, SML was not prepared to expand the exploration scope while not in full control of the project's expected timeline.
The decision to acquire the balance of the project was a mutually acceptable one for both SML and Rarus and the continued involvement of Andrew Spinks was considered crucial to SML assuming outright responsibility for the development projects.
Before the end of the June quarter, SML intends to update the market on its development plans in relation to the CARE tenements."
For further information, please contact:
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Strategic Minerals plc John Peters Managing Director Follow Strategic Minerals on:
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+61 (0) 414 727 965 |
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SP Angel Corporate Finance LLP Nominated Adviser and Joint Broker Ewan Leggat
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+44 (0)20 3470 0470 |
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Optiva Securities Limited Joint Broker Graeme Dickson
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+44 (0)20 3411 1880 |
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Yellow Jersey PR Financial PR Felicity Winkles Alistair de Kare-Silver Joe Burgess
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+44 (0)7825 916 715 |
Notes to Editors
Strategic Minerals Plc is an AIM-quoted, diversified mineral development and production company with projects in the United States of America, the UK and Australia. The Company is focused on acquiring and developing cash generative, high quality projects which meet local market demand for commodities and utilising this cash flow to undertake value added exploration.
In September 2011, Strategic Minerals purchased its first cash generating asset; the Cobre magnetite tailings dam project in New Mexico, USA which it brought into production in 2012 and which continues to provide a revenue stream for the Company. The portfolio was expanded in January 2016 with the acquisition of shares in Central Australian Rare Earths Pty Ltd, which holds tenements in Western Australia and the Northern Territory that are prospective for cobalt, gold, nickel sulphides and rare earths. In May 2016, an additional exploration asset was acquired when the company entered into an agreement with New Age Exploration Limited to acquire up to 50% of the Redmoor Tin/Tungsten project in Cornwall, UK. This 50% acquisition has now been completed and drilling at the project has commenced.
This information is provided by RNS
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