Join our daily newsletter At The Bell to receive exclusive market insights
- Specialty metals producer Australian Strategic Materials (ASM) is set to acquire nearly all of the interest in joint venture (JV) partner Ziron Technology
- The JV partner, colloquially known as Ziron Tech, owns patented metal-refining technology
- Under the binding heads of agreement (HoA), ASM will net a 95 per cent stake in Ziron, along with the pilot plant the JV partner used to test its technology
- The agreement will also see Ziron Tech founder Professor Jonghyeon Lee step into the Chief Technical Advisor role, where he’ll continue to head up the Ziron team and the tech’s development
- To pay for its fresh stake, ASM will issue over 1.3 million shares to Ziron shareholders at $2.068 each, calculated based on the 10-day volume-weighted average prices (VWAP) up to and including September 2
- ASM and Ziron hopes to dot the i’s and cross the t’s on all the paperwork over September and finish the transaction by the end of next month
- ASM shares are trading up 8.29 per cent this morning, priced at $2.22 each
Specialty metals producer Australian Strategic Materials (ASM) is set to acquire nearly all of the interest in joint venture (JV) partner Ziron Technology.
The JV partner, colloquially known as Ziron Tech, owns patented metal-refining technology. Significantly, its process is said to be a more environmentally friendly and cost-effective alternative to other metallisation methods.
Under the binding heads of agreement (HoA), ASM will net a 95 per cent stake in Ziron, along with the pilot plant the JV partner used to test its technology. The materials stock will also acquire all of Ziron’s intellectual property, including its patented metallisation tech.
ASM evaluated Ziron’s tech during pilot plant testwork on the metals it’s found so far at its flagship Dubbo Project in southern central NSW — including zirconium, hafnium and other rare earths with permanent magnet alloys.
The agreement will also see Ziron Tech founder Professor Jonghyeon Lee step into the Chief Technical Advisor role, where he’ll continue to head up the Ziron team and the tech’s development.
Moving forward, the Ziron team will continue to refine the metal-coating technology alongside ASM.
Transaction details
In order to complete the transaction, both ASM and Ziron Tech will have to get approval from their respective boards on paper.
When that happens, ASM will move to buy all of RMR Tech — the JV company formed by the company and Ziron. Originally, ASM owned just 10 per cent of the joint venture vehicle.
Once it acquires the full stake, ASM — operating as RMR Tech — will buy the 95 per cent stake in Ziron. Meanwhile, Jonghyeon Lee will keep a five per cent holding.
To pay for its fresh stake, ASM will issue over 1.3 million shares to Ziron shareholders at $2.068 each, calculated based on the 10-day volume-weighted average prices (VWAP) up to and including September 2.
All up, this equates to a US$2 million (around A$2.73 million) consideration to Ziron shareholders.
In addition, ASM will provide Ziron shareholders with a five per cent net smelter return (NSR) if it’s able to commercialise a global metalisation plant based on the Ziron tech.
ASM and Ziron hopes to dot the i’s and cross the t’s on all the paperwork over September and finish the transaction by the end of next month.
ASM shares are trading up 8.29 per cent this morning, priced at $2.22 at 11:09 am AEST.
