Altona Rare Earths to acquire majority stake in Chambe rare earth project via new JV
Mining firm Altona Rare Earths has agreed to acquire an initial 51% stake in Malawi's Chambe rare earth project as part of a joint venture with Akatswiri Mineral Resources.
Altona said on Thursday that it will immediately make an initial payment of 1.0m shares in the company for the stake, which will be held in escrow by its Malawian lawyer until such time as the licence is transferred from Akatswiri to Altona.
Chambe, which has been granted an exploration licence that will remain valid until 6 September 2024, covers an area of 128 square kilometres in the Mulanje region of Southern Malawi.
Historic exploration work was carried out on the site between 2009 and 2014, confirming the presence of mineralised rare earth oxide clays, similar to many of the larger, high-value heavy rare earth mines in China.
Altona highlighted that it can also increase its interest in Akatswiri Rare Earths, into which the exploration licence was in the process of being transferred, to 70%, subject to the fulfillment of work and expenditures commitments, as well as payments over the course of the project by Altona to AMR.
The company will bear 100% of the project's costs up to the completion of Phase III and holds a majority position on the board of ARE. The total cash expenditure in respect to the purchase of Chambe was expected to be approximately £200,000.
Separately, Altona said it was continuing to work with the Financial Conduct Authority to complete the "rigorous listing process" for its proposed LSE Standard application.
Altona said details of the Chambe acquisition and its new joint venture partner would need to be included in its current prospectus, along with a competent person's report on the project.
"The company expects the CPR will take approximately six weeks to complete and therefore it is advising shareholders that any proposed listing date will need to factor in this additional period or work," said Altona.
As of 0930 BST, Altona shares were down 0.39% at 12.75p.