Blackstone Minerals Ltd (ASX:BSX) has attracted a $6.8 million investment at a substantial premium after signing a binding share purchase agreement with EcoPro Co Ltd, the world’s second-largest and Korea’s largest nickel-rich cathode materials manufacturer.
Securities surged more than 52 per cent on the news to an intra-day high of 16 cents, up from 8 cents at close on March 19.
The binding share purchase agreement outlines a firm commitment to raise $6.8 million before costs through a placement of 40 million shares at an issue price of 17 cents per share, which represents a 62% premium to Blackstone Minerals’ last traded price on Monday.
It also outlines an alliance structure whereby EcoPro and Blackstone Minerals will work in partnership, through additional investment by a joint venture, to develop a downstream processing facility in association with Blackstone Minerals’ Ta Khoa Nickel-Platinum Group Elements (PGE) Project in northern Vietnam.
“Strengthens alliance with EcoPro”
Managing director Scott Williamson said: “We are pleased to announce this investment of $6.8 million at a premium which strengthens our alliance with EcoPro.
“Our Ta Khoa Nickel-PGE Project has the potential to deliver the critical raw materials required for EcoPro’s cathode manufacturing to meet the demand from the imminent electric vehicle (EV) revolution.
“We look forward to working towards the next stage of our partnership to develop the downstream processing facility in northern Vietnam”.
“Important to secure metal materials”
EcoPro'a Strategic Planning Division vice-president Sangwook Park said: “It is very important to secure stable and competitive metal materials in the fast-growing secondary battery and cathode active material business.
“EcoPro has therefore decided that it is a good time to invest in Blackstone.
“Based on that, we are looking forward to continuing with our partnership so that we can succeed in a downstream JV in the near future.”
Terms of the agreement include:
- The placement of 40 million shares at 17 cents per share, to be issued under the company’s existing placement capacity with shares to be issued and allotted by April 16;
- EcoPro to appoint a director to the board of Blackstone Minerals;
- Blackstone Minerals to exercise the binding option agreement to purchase AMR Nickel Limited’s 90% interest in the Ta Khoa Nickel-PGE Project; and
- EcoPro and Blackstone Minerals to form an alliance whereby the next stage of the partnership will be an additional investment through a joint venture agreement to develop the downstream processing infrastructure project in association with Blackstone Minerals’ Ta Khoa project.
Blackstone Minerals aims to deliver a maiden resource in the September quarter of 2020, focused initially on the disseminated sulphide (DSS) at Ban Phuc and continues to investigate the potential to restart the existing Ban Phuc concentrator through focused exploration on both massive sulphide veins (MSV) and DSS deposits.
The company has begun a scoping study on the downstream processing facility at Ta Khoa, which will provide details for joint venture partners to formalise the next stage of investment.
Blackstone has also started metallurgical testing on the Ban Phuc DSS deposit with an aim to develop a flowsheet for a product suitable for the lithium-ion battery industry.
In addition, the company is investigating the potential to develop downstream processing infrastructure in Vietnam to produce a downstream nickel and cobalt product to supply Asia’s growing lithium-ion battery industry.
Further geophysics on the MSV and DSS targets will be undertaken as the company continues its maiden drilling campaign.