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- Diatreme Resources (DRX) forms a strategic partnership with a subsidiary of SCR-Sibelco to develop its silica sands projects in Far North Queensland
- The partnership will raise up to $52 million via a placement of new shares and a two-tranche asset joint venture with Sibelco and the company’s largest shareholder, Ilwella
- Following completion of the placements to Silbelco and Ilwella, their respective undiluted shareholdings in Diatreme will be 15 per cent and 19.99 per cent
- The company will use the money to fund any potential stamp duty and transaction tax costs connected with the transfer of Diatreme’s tenements to establish the joint venture structure, among other activities
- Shares in Diatreme are down 19.5 per cent, trading at 3.3 cents as of 1:32 pm AEST
Diatreme Resources (DRX) has formed a strategic partnership with a subsidiary of a globally-based material solutions company SCR-Sibelco.
Under the deal, the parties will work together to progress the development of Diatreme’s silica sands projects in Far North Queensland.
The partnership will raise up to $52 million via a placement of new shares and a two-tranche asset joint venture with Sibelco and the company’s largest shareholder, Ilwella.
Sibelco will become a major shareholder through the placement of approximately 559 million new shares at 2.5 cents to raise a total of $13.97 million.
It will also pour a further $35 million split into two tranches of $11 million and $24 million respectively as part of its joint venture to develop Diatreme’s Galalar Silica project and Northern Resource project.
Ilwella will also receive around 132 million shares at the same issue price as Sibelco to raise a further $3.3 million, subject to Diatreme receiving shareholder approval at an Extraordinary General Meeting (EGM).
Following completion of the placements to Silbelco and Ilwella, their respective undiluted shareholdings in Diatreme will be 15 per cent and 19.99 per cent.
Diatreme CEO Neil McIntyre said the company is now perfectly placed to secure a leading position in the “fast-growing” global high quality silica sands industry and assist in powering Asia’s solar energy revolution.
“Sibelco’s investment into Diatreme at both the corporate and silica projects portfolio level is a vote of confidence in our company, our strategy to date and the inherent quality of our high-grade, world class silica sand projects.
“Sibelco is the perfect partner for us to unlock the value of our world-class silica sand deposits for the benefit of both companies and all our stakeholders, including our First Nations partners and other local communities.”
The company will use the money raised to fund any potential stamp duty and transaction tax costs connected with the transfer of Diatreme’s tenements to establish the joint venture structure.
Funds will also be used to further the development of its projects portfolio, maintenance of tenements and all associated ongoing obligations for exploration, permitting and approvals processes currently underway.
Shares in Diatreme were down 19.5 per cent, trading at 3.3 cents as of 1:32 pm AEST.
