MKANGO RESOURCES LTD.
550 Burrard Street
Suite 2900
BC V6C 0A3
MKANGO RAISES
Highlights
· Mkango Resources ("Mkango" or the "Company") has conditionally raised gross proceeds of
· EIT RawMaterials GmbH ("EIT RawMaterials") will, subject to the approval of the Toronto Venture Exchange (TSX-V), provide additional funding of
· EIT RawMaterials is an impact investor, and provides strategic support to start-up and scale-up projects across metals and minerals value chain. EIT RawMaterials was established in 2015 to develop raw materials into a major strength for
· Last month's signing of the Mine Development Agreement (''MDA'') for the Songwe Project and the opportunity to progress process optimisation through the investment by EIT RawMaterials enhance options for the Songwe and Pulawy Projects in conjunction with the ongoing strategic review.
· In parallel, discussions continue with potential strategic investors, project finance providers, grant funding bodies and other sources to finance recycling scale-up opportunities and further technology roll-out.
· Use of proceeds from the Subscription include the acquisition of additional equipment for the 2025 commercial development of rare earth magnet recycling operations at Tyseley Energy Park in
· The Company continues to put a strong focus on cost cutting initiatives to conserve working capital in order to advance the Company's assets, and executive management have agreed to continue the salary reductions and bonus scheme announced on 10th May 2024.
William Dawes, Chief Executive of Mkango stated: "In light of progress being made by HyProMag as it progresses towards commercialisation of rare earth magnet recycling in the
''Since obtaining the MDA for Songwe last month, we now believe there is additional value to be unlocked from both Songwe and Pulawy which is not reflected in our current market capitalisation and will be considered in our review of strategic options for the project. Nevertheless, our current focus remains on advancing our recycling business to commercial production - the see-through valuation for Mkango's interest in Maginito implied by the CoTec investment alone was
The Subscription
The issue price equates to a discount of 4% and 22.1% to the trailing five-day volume weighted average price ("VWAP") of Mkango's shares on AIM and TSX-V respectively.
The Subscription is expected to close on or around 5 September 2024 and is subject to the receipt of all necessary approvals including the approval of the TSX-V, and admission of the Subscription Shares to trading on AIM.
The 25,000,000 Subscription Shares will rank pari passu with the Company's existing shares and application will be made for the Subscription Shares to be admitted to trading on AIM ("Admission"). It is expected that Admission will become effective and dealings in the Subscription Shares will commence at 8:00am on or around 5th September, 2024. The Subscription Shares and Mkango Shares issuable pursuant to exercise of the Warrants will be subject to a statutory hold period in
In accordance with the Disclosure Guidance and Transparency Rules (DTR 5.6.1R) the Company hereby notifies the market that immediately following Admission of the Subscription Shares, its issued and outstanding share capital will consist of 293,453,574 Mkango Shares. The Company does not hold any shares in treasury. Shareholders may use this figure as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rules.
In connection with the Subscription, Mkango has agreed to pay, at completion of the Subscription, commissions of 5% in cash and 5% in non-transferable broker warrants ("Broker Warrants") to Jub Capital Management LLP ("Jub Capital") on funds raised by Jub Capital. The Broker Warrants will have a term of 3 years from issue and an exercise price of 5p each (approximately
The EIT RawMaterials Investment
In addition to the Subscription, Mkango Polska will, subject to TSX-V approval, receive further funding of
This funding will be used to optimise the chemical and physical properties of the raw material, specifically mixed rare earth carbonate sourced from Songwe Hill in
The funding is structured as a combination of equity and grant funding. EIT RawMaterials will be issued with 6 new shares in Mkango Polska resulting in a 5.7% interest in Mkango Polska for PLN300. Concurrently, a grant of
A put and call agreement has been entered into between EIT RawMaterials and Mkango, whereby both the equity investment and grant can be converted, subject to TSX-V approval, at either parties' option into Mkango Shares no later than 30 November 2024 or such later time as the parties may agree in writing.
The number of Mkango Shares to be issued to EIT RawMaterials shall be determined by dividing the sum of
About Mkango
Mkango is listed on the AIM and the TSX-V. Mkango's corporate strategy is to become a market leader in the production of recycled rare earth magnets, alloys and oxides, through its interest in Maginito Limited ("Maginito"), which is owned 79.4 per cent by Mkango and 20.6 per cent by CoTec, and to develop new sustainable sources of neodymium, praseodymium, dysprosium and terbium to supply accelerating demand from electric vehicles, wind turbines and other clean energy technologies.
Maginito holds a 100 per cent interest in HyProMag and a 90 per cent direct and indirect interest (assuming conversion of Maginito's convertible loan) in HyProMag GmbH, focused on short loop rare earth magnet recycling in the
Maginito and CoTec are also rolling out HyProMag's recycling technology into
Mkango also owns the advanced stage Songwe Hill rare earths project and an extensive rare earths, uranium, tantalum, niobium, rutile, nickel and cobalt exploration portfolio in
For more information, please visit www.mkango.ca
Market Abuse Regulation (MAR) Disclosure
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR') which has been incorporated into
Cautionary Note Regarding Forward-Looking Statements
This news release contains forward-looking statements (within the meaning of that term under applicable securities laws) with respect to Mkango. Generally, forward looking statements can be identified by the use of words such as "targeted", "plans", "expects" or "is expected to", "scheduled", "estimates" "intends", "anticipates", "believes", or variations of such words and phrases, or statements that certain actions, events or results "can", "may", "could", "would", "should", "might" or "will", occur or be achieved, or the negative connotations thereof. Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties, both general and specific, that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause actual performance and results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. Such factors and risks include, without limiting the foregoing, the availability of (or delays in obtaining) financing to develop the Songwe Hill Project, the various recycling plants in the
For further information on Mkango, please contact:
Mkango Resources Limited
William Dawes Alexander Lemon
Chief Executive Officer President
will@mkango.ca alex@mkango.ca
@MkangoResources
SP Angel Corporate Finance LLP
Nominated Adviser and Joint Broker
Jeff Keating, Caroline Rowe
Alternative Resource Capital
Joint Broker
Alex Wood, Keith Dowsing
The TSX Venture Exchange has neither approved nor disapproved the contents of this press release. 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 press release does not constitute an offer to sell or a solicitation of an offer to buy any equity or other securities of the Company in
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