Pursuant to the agreement between Mkango Resources and Talaxis:
- Talaxis will invest £12 million in three tranches to fully fund a feasibility study in Songwe for a 49% interest in the project, in addition to £2 million in two tranches in return for a 49% interest in a new venture (Newco) to be established by Mkango Resources focused on neodymium alloy powders, magnet and other technologies
- The first and second tranches, totaling £5 million, of the investment into the project will be invested following receipt of minority approval, to be sought at a meeting scheduled for January 18, 2018. The first tranche of £2 million is being placed into escrow by Talaxis pending the meeting
- The first tranche of the investment into Newco, totaling £1 million, will also be invested on receipt of minority approval
- Therefore a total of £6 million will be invested by Talaxis on minority approval and a further £8 million will be invested on completion of the definitive documentation and according to the milestones in the agreement, following which Talaxis will hold a 49% interest in each of the project and Newco
- Talaxis will also have the option to acquire a further 26% interest in the project by arranging funding for project development, following which Mkango Resources would hold a 25% interest in the project, free carried until commencement of production
- Talaxis and Mkango Resources have agreed to cooperate as preferred partners on rare earths projects worldwide and on other projects in Malawi. Mkango Resources will be releasing further information in relation to the meeting in due course
“We are pleased to announce conditional acceptance by the TSX Venture Exchange, following which we have a definitive timetable for the transaction,” states Mkango Resources CEO, William Dawes.
“On shareholder approval and receipt of £6 million investment by Talaxis, Mkango Resources will commence the initial phase of the feasibility study, including mobilization for an extensive infill, geo-technical and exploration drilling programme starting in the second quarter of 2018, in parallel with ongoing processing flow sheet optimization and work in relation to the Environmental, Social and Health Impact Assessment.
“We look forward to updating the market in relation to the transaction and Mkango Resource’s other projects in Malawi, the Thambani uranium-tantalum-niobium project and Chimimbi Hill nickel-cobalt project,” he concludes.
Feature image credit: Wikimedia