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Iron ore explorer Champion Iron (ASX:CIA) has spiked more than +4.2% in intra-day trade on Tuesday after signing a definitive framework agreement with Japan’s Nippon Steel Corporation and Sojitz Corporation to jointly develop the Kamistiatusset Iron Ore Project in Labrador, Canada.
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Champion Iron’s price has already fluctuated over the last six months, recently rising quite sharply – by as much as +27% – over a recent low of $3.95.
The Oz iron company has been trading at $5.05 through Tuesday. This new deal will see the two Japanese partners contribute a combined $245 million to acquire a 49% stake in the newly formed Kami Iron Mine partnership.
Champion Iron will retain a 51% stake and continue as project operator.
There’ll be two phases to the deal: The initial closing late in 2025 will see Nippon Steel and Sojitz contribute CAD$68.6 million (and is still subject to approvals). Then, in mid-2026, the partners will inject a further CAD$176.4M to fund permitting, community engagement, DFS, and to support a potential final investment decision.
Company chief David Cataford today highlighted that the agreement is “a significant milestone for the Kami Project,” and said it would establish “a clear structure to advance its evaluation alongside trusted partners who share our long-term vision for the growing demand for high-purity iron ore.”
He emphasised the partnership will “enable us to advance the project without impacting the company’s financial liquidity in the foreseeable future.”
In recent months this year, Champion launched its Environmental Impact Statement, as required by the Government of Newfoundland. In the near term, the Aussie company will also continue to engage local stakeholders to ensure the Kami Project has “a positive impact on the region.”
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The company has a market capitalisation of nearly A$2.7 billion, trailing twelve‑month revenue close to A$1.8 billion, and earnings of A$158 million, with a dividend yield of approximately 4.8%.
The company carries a ‘buy’ rating amongst six brokers.
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