Mkango Resources Limited has said its shareholders have approved an investment decision with Talaxis Limited on a disinterested basis.
In its statement signed by the company’s Chief Executive Officer, William Dawes, Mkango said subject to the approval, it is anticipated that the investments of £5 million (comprising £2 million paid out of escrow and £3 million from Talaxis) will be received by Mkango’s subsidiary, Lancaster Exploration Limited, and £1 million will be received by Mkango’s new subsidiary, Maginito Limited, on or around January 24 2018.
In November last year, Talaxis, a subsidiary of commodities trader Noble Group acquired 14,285,715 common shares of Mkango Resources, translating to a 14.5 percent shareholding.
Mkango is a dually-listed company on the Alternative Investment Market (AIM) of the London Stock Exchange and Canada’s TSX Venture Exchange.
The deal saw Talaxis become a major shareholder of Mkango worth £500,000 at 3.5 pence per share.
According to Mkango, the proceeds of the deal will see the commencement of phase II of the research and development programme with metalysis, continued optimisation of the Songwe Hill rare earths project, ongoing evaluation of additional opportunities in addition to other expenditures.
Dawes said the Phase II work programme with metalysis includes product quality optimisation, test work scale-up, and further analyses of the alloy to determine characteristics such as its morphology, chemical composition, and physical and magnetic properties.
He said the Phase II will also incorporate customer appraisal of the product and further investigation of opportunities in relation to 3D printing of magnets.
“We are very pleased to have Talaxis as a new and our largest shareholder. Having signed the collaboration agreement with Noble in December 2016, this latest transaction is a natural extension of that relationship and demonstrates strong confidence in the company and the sector.
“We look forward to continuing to work with Talaxis and Noble to progress both the advanced stage Songwe Hill rare earths project and the Metalysis NdFeB Research and Development programme through the development phases,” Dawes said.