RareX has signed an agreement to divest a percentage of its asset level interests in several exploration licences in NSW, including one in Condobolin, to its joint venture partner, Kincora Copper.
Under the agreement, RareX will sell a 35 per cent stake in the Condobolin, Cundumbul, Fairholme, Jemalong and Trundle exploration licences.
In exchange, RareX will receive 40 million Kincora Chess Depositary Interests (CDIs) and a one per cent net smelter return royalty (NSR).
Concurrent with the transaction, Kincora has undertaken an oversubscribed $2 million placement with RareX becoming Kincora’s largest shareholder post the placement and transaction with a holding of approximately 45 million shares (18 per cent) in Kincora, comprising 40 million shares issued under this transaction and five million already owned by RareX.
“These transactions significantly increase the strategic value of, and funding options for our NSW project portfolio and strengthen Kincora’s balance sheet,” Kincora President and CEO, Sam Spring, and chair, Cameron McRae, commented in a statement.
“Kincora will hold 100 per cent ownership in eight projects, covering 2,367km2 in highly prospective settings within world-class gold-copper mineral belts in a Tier-1 jurisdiction.
“Coupled with the oversubscribed A$2m raising, the Company is in a strong position to both extend high priority drilling and accelerate ongoing asset level partner discussions at a time where we are seeing very significant corporate activity in our district.
“We are very pleased to welcome experienced resource director and executive Jeremy Robinson to Kincora’s board and a number of new professional investors to the register.”
As part of the agreement, RareX chairman Jeremy Robinson has been invited to join Kincora’s Board as a Non-Executive Director and member of the Company’s Remuneration Committee.
“RareX is a big believer in Kincora’s NSW portfolio and industry leading technical team as evidenced by us becoming significant shareholders and converting our asset level interests,” he said.
“We expect these transactions to be a real catalyst to accelerate ongoing asset level partner discussions and also be a positive share price catalyst in the immediate to longer term.
“I am personally very pleased to assist at the board level and support Kincora’s endeavour to become a significant copper-gold player.”
The transaction is subject to the securing approvals by the companies required under the Mining Act 1992 (NSW), and Kincora obtaining shareholder approval proposed to be obtained at an annual general and special meeting to be convened in September. Another condition the transaction is subject to is Kincora completing a placement for an aggregate subscription amount of not less than 30 million CDIs ($1.5m) noting today’s announcement by Kincora for binding commitments for an oversubscribed private placement of 40 million CDIs raising $2 million (before costs)
RareX Limited is a Perth based project development and exploration Company, which was founded on the fundamental belief of the electronics revolution and the electric vehicle mega-trend. Their focus is rare earths and associated battery and electronic metals.