viewFe Limited

Fe Limited adding $7 million to bank balance after iron ore royalty interest sale is approved

Shareholders voted overwhelmingly in favour of the sale during an extraordinary general meeting on Friday.

Fe Limited - Fe Limited adding $7 million to bank balance after iron ore royalty interest sale is approved
The royalty is over a portion of the Koolyanobbing Iron Ore Mine in WA

Fe Limited (ASX:FEL) is set to add $7 million in cash to its bank balance after shareholders on Friday approved the sale of FEL’s Evanston royalty interest over a portion of the Koolyanobbing Iron Ore Mine in WA.

When put to the vote at an extraordinary general meeting, there were more than 184 million votes for the sale recommendation and just 183,821 against.

Approval of shareholders was one of the conditions of a sale and purchase agreement with TRR Services Australia Pty Ltd, a subsidiary of Trident Resources PLC (LSE:TRR).

Two instalments

This agreement provides for cash consideration to be paid in two instalments with the first $4 million payable upon completion of the transaction and the remainder payable one day after the first anniversary of completion.

The sale provides certainty for FEL’s financing position as the royalty stream is variable and depends on a range of factors such as the iron ore price, currency and production rates over which FEL has no control.

Sale advantages

Apart from providing financial certainty, advantages of the sale are:

  • The transaction provides the company with $7 million in cash (before costs associated with the transaction);
  • The transaction will allow the company to consider other acquisitions which may increase shareholder value; and
  • The transaction provides the company with working capital to explore its prospective Pilbara landholding, including following up the recent copper drilling program completed at Hillside.

FEL’s Evanston iron ore royalty is a 1.5% dry metric tonne, FOB royalty over two tenements, one of which is within Mineral Resources Limited’s (ASX:MIN) Koolyanobbing project in the Southern Yilgarn Iron Province.

This tenement covers one of the current pits in the Koolyanobbing Iron Ore Project, known as Deception.

FEL has received $1.829 million in the last 12 months from the sale of 1.228 million tonnes following the recommissioning of the mine in December 2018.

Quick facts: Fe Limited

Price: 0.024 AUD

Market: ASX
Market Cap: $11.73 m

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events


The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Fe Limited named herein, including the promotion by the Company of Fe Limited in any Content on the Site, the Company receives from said issuer...


Fe Limited undertakes capital raising to fund rapid exploration of new...

Fe Limited (ASX:FEL) chairman Tony Sage updates Proactive Investors on the company's recent lithium acquisitions in Western Australia, potentially giving FEL the biggest landholding of lithium tenements in the country.    Sage says an extensive mapping program focusing on...

on 28/5/19

2 min read