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Alkane Resources schedules meeting to vote on demerger of Australian Strategic Materials

Rare earths focused ASM owns the $1 billion Dubbo Project in Central West NSW and is building a pilot plant facility in South Korea.

Alkane Resources Ltd - Alkane Resources schedules meeting to vote on demerger of Australian Strategic Materials
A virtual extraordinary general meeting will be held on Thursday, July 16

Alkane Resources Limited (ASX:ALK) (OTCMKTS:ALKEF) is progressing the demerger of rare earths focused Australian Strategic Materials Limited (ASM) with a meeting of shareholders scheduled next month to vote on the move.

After Alkane’s board resolved to progress the demerger transaction, which involves listing ASM separately on the Australian Securities Exchange (ASX), an extraordinary general meeting will be held on Thursday, July 16 at 10am AWST (12 noon AEST).

Shareholder approval for the demerger will be sought at the EGM which will be held via a virtual online platform.

Opportunities to grow value

Gold producer Alkane has stated that the demerger will provide investors with opportunities to grow value in ASM as a critical materials business.

Chairman Ian Gandel said: “The demerger of ASM will provide investors two opportunities to grow value; in Alkane as a growing gold exploration, development and production company, and in ASM as an exciting critical materials business leveraged to the changing world economy.”

ASM assets

ASM owns the $1 billion Dubbo Project in Central West NSW, an advanced polymetallic project with large in-ground resource of zirconium, rare earth elements (including yttrium), niobium and hafnium.

This polymetallic project represents a strategic and independent supply of critical minerals for a range of sustainable technologies and future industries.

The Dubbo Project is development-ready, subject to financing, with the mineral deposit and surrounding land acquired, all major state and federal approvals in place and extensive piloting and engineering completed.

ASM is also building a pilot plant facility in South Korea to produce high-purity metals in parallel with developing the design for the world’s first commercial-scale metal plant.

This will help meet the growing demand for a new source into domestic and global markets for ASM’s range of high-purity and value-added critical metals including zirconium, rare earth magnet metals, praseodymium and neodymium, and hafnium.

Preparation for listing

Substantial preparation has already occurred in readiness for ASM to operate as an independent listed entity.

In February 2020, David Woodall joined ASM as managing director and has focused on distilling the key value drivers for ASM and the Dubbo Project.

In addition to Woodall, the ASM board will comprise Ian Gandel as chairman, with Gavin Smith, Ian Chalmers and Nic Earner serving as non-executive directors.

In March, the Australian Government-owned Export Finance Australia (EFA) confirmed interest in financing the Dubbo Project, stating it closely aligns with the initiative by the Australian Government to develop its ‘Critical Minerals’ sector.

At the completion of the demerger, if approved, Alkane shareholders will have the same proportional ownership in both Alkane and ASM, with the exception of ineligible foreign shareholders.

A copy of the Online Meeting Guide that gives full details of how to participate in the meeting and vote is available for download from the company’s website - http://www.alkane.com.au/demerger/

Quick facts: Alkane Resources Ltd

Price: 1.25 AUD

ASX:ALK
Market: ASX
Market Cap: $730.84 m
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