Rio Tinto to Become Major Shareholder in Sovereign Metals With $27.6 Million Investment
July 17 2023 - 3:28AM
Dow Jones News
By Christian Moess Laursen
Sovereign Metals said Monday that Rio Tinto will invest 40.4
million Australian dollars ($27.6 million) to acquire a 15% stake
in the company, becoming a strategic investor.
The London and Australian-listed mining company said the money
will be used to advance the Kasiya rutile-graphite project in
Malawi.
Under the investment agreement, Rio Tinto--the world's
second-biggest miner by market value--will provide assistance and
advice on technical and marketing aspects of Kasiya.
"We welcome Rio Tinto as a major shareholder of Sovereign and
look forward to working with Rio Tinto as our strategic partner in
the development of Kasiya," Chairman Ben Stoikovich said.
Sovereign issued 83 million new shares to Rio Tinto at a price
of A$0.486 a share representing a 10% premium to the 45-day volume
weighted average price at July 14 close-of-business.
Rio Tinto has the exercise option to increase its stake by 4.99%
to potentially 19.99% within 12 months. The 34.5 million options
issued have an exercise price of A$0.535 per share, a 21% premium
to the 45-day volume weighted average price at July 14
close-of-business, for additional proceeds of up to $18.5
million.
Write to Christian Moess Laursen at christian.moess@wsj.com
(END) Dow Jones Newswires
July 17, 2023 03:13 ET (07:13 GMT)
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