Peak Rare Earths said that Chinese rare earths producer Shenghe Resources will acquire the Australian firm for A$150.5 million, in addition to the full amount raised under Peak’s proposed A$7.5 million entitlement offer.
Under the deal, the state-owned miner’s unit Ganzhou Chenguang Rare Earths New Material will buy Peak for a minimum of A$0.359 per share in cash, if the entitlement offer is raised in full.
Shenghe already owns about 19.8% of the Australia-listed rare earths firm through subsidiary Shenghe Signapore and has the rights to buy all of the rare earths concentrate from Peak’s Ngualla rare earth project in southern Tanzania.
“We are also mindful of the importance to Tanzania of developing the Ngualla project and believe that Shenghe is well positioned to partner with the Government of Tanzania to successfully develop this world-class project,” said Peak Rare Earths Chair Russell Scrimschaw.
The deal is subject to a shareholder vote and approval from regulatory bodies in China, Tanzania and Australia.
The Ngualla project, located near the Ngwala Village and approximately 150 kilometres from the City of Mbeya, contains one of the largest, highest grade and lowest cost Neodymium Praseodymium rare earth deposits in the world.
Source: Reuters