- Red Mountain Mining (RMX) has finalised its long-winded buyout of the WA-based Mt Mansbridge heave rare earths and nickel-cobalt project
- The deal was successful after Red Mountain tried to snap Mt Mansbridge up earlier this year but was shot down by shareholders
- This time around, RMX offered $100,000 and 50 million shares for the WA project, and shareholders voted in favour of the deal on December 8
- Mt Mansbridge is prospective for rare earth elements, with anomalous yttrium and dysprosium found in previous exploration drilling
- The deal expands Red Moutain’s exploration portfolio, which includes gold projects in Australia and copper-cobalt projects in the Democratic Republic of Congo (DRC)
- Shares in Red Mountain are up over 8 per cent at midday to 1.3 cents each
Red Mountain Mining (RMX) has finalised its long-winded buyout of the WA-based Mt Mansbridge heave rare earths and nickel-cobalt project.
The deal has been a long time in the making, with RMX shareholders shooting down the initial offer earlier this year.
In February, Red Mountain was planning to take full control of Mt Mansbridge for $100,000 cash and 100 million shares. With shares priced around one cent each at the time, this valued the transaction at roughly $1.1 million.
It seems this price was a bit too steep for investors, however, with 77.6 per cent of shareholders voting against the buy at a March general meeting. So, it was back to the drawing board to Red Mountain.
Then in October, RMX came forward with a new plan, this time offering $100,000 in cash and 50 million shares for the project.
On December 8, Red Mountain shareholders voted in favour of the new deal. Today, the company said it has finalised settlement of the Mt Mansbridge purchase.
Why the buy?
The Mt Mansbridge project is in the Kimberley region of Western Australia, near the border between WA and the Northern Territory.
Red Mountain was initially drawn to the project because of its prospectivity for heavy rare earth elements (HREEs) — specifically, previous exploration at Mt Mansbridge revealed anomalous occurrences of yttrium and dysprosium.
While Red Mountain has been exploring for gold in Australia and copper-cobalt in the Democratic Republic of Congo (DRC), the company said it has noticed recent health price rises in HREEs and understands the critical role the elements have in modern economies.
The likes of batteries, computer memory, magnets, fluorescent lighting, and critical military equipment all operate with the help of rare earth elements. As such, Red Mountain is expanding its exploration portfolio with the Mt Mansbridge buyout.
The company said now that the buy has been completed, it will focus on a work programme for Mt Mansbridge and update shareholders in due course.
So far, investors are supportive of the deal. Shares in RMX are up 8.33 per cent at midday AEDT to trade at 1.3 cents each. The company has a $14.71 million market cap.