China's rare earth leader Shenghe Resources Holding Co.Ltd(600392) has another overseas M & a plan.
Today (11th), Shenghe Resources Holding Co.Ltd(600392) disclosed that the company plans to acquire 19.9% equity of peak rareearths Limited (hereinafter referred to as peak rare company) for about 180 million yuan.
The target company is mainly engaged in ngualla rare earth mine project in Tanzania and Teesside refinery project to be invested and constructed in the UK. Ngualla rare earth mine project is expected to invest about US $200 million, process about 800000 tons of raw ore and produce about 37200 tons of rare earth concentrate (45% REO).
On the 11th, Shenghe Resources Holding Co.Ltd(600392) relevant people told the reporter of daily economic news that the mine has large scale, high grade and high content of praseodymium and neodymium.
High grade of target ore
Shenghe Resources Holding Co.Ltd(600392) announced that the company, through the holding company Shenghe Resources Holding Co.Ltd(600392) (Singapore) Co., Ltd. (hereinafter referred to as Shenghe Singapore), which is 100% owned by Leshan Shenghe rare earth Co., Ltd., a wholly-owned subsidiary, intends to sign relevant agreement letters with Appian pinnacle HoldCo limited, agreeing that Shenghe Singapore will purchase 39.64 million ordinary shares of peakrare company held by Appian company at a price of a $0.99/share, It accounts for about 19.9% of the total issued shares of peak rare, and the total acquisition amount is about a $39.248 million, equivalent to about 180 million yuan.
Peak rare, headquartered in Perth, Western Australia, is listed on the Australian Stock Exchange (Code: PEK). It is mainly engaged in ngualla rare earth mine project in Tanzania and Teesside refinery project to be invested and constructed in the UK.
The core asset of peak rare is the ngualla rare earth mine project owned by its wholly-owned subsidiary PR ngminerals Ltd (hereinafter referred to as PR ng) in Tanzania. Ngualla rare earth mine project is located in southern Tanzania, covering an area of 18.14km2. According to JORC (2012) standard, taking 1% as the cut-off grade, the ore resource is 214 million tons, with an average grade of 2.15%, equivalent to 4.61 million tons of REO. Rare earth reserves are 18.5 million tons, with an average grade of 4.8%, equivalent to 887000 tons of REO. Praseodymium neodymium oxide accounts for about 21.26% of rare earth oxides. At present, special mining license (SML) is being applied for.
Ngualla rare earth mine project is expected to invest about US $200 million, process about 800000 tons of raw ore and produce about 37200 tons of rare earth concentrate (45% REO).
, Shenghe Resources Holding Co.Ltd(600392) relevant people told reporters that the mine has large scale, high grade and high praseodymium and neodymium content.
M & a still has risks to pay attention to
Another focus in the announcement is the rare earth refining project to be invested by peak rare.
Peak rare plans to build a rare earth refinery at Wilton international base near Middlebrook town in Tees Valley, UK, with an annual output of 9900 to 11600 tons of various rare earth products. The construction and development expenditure of the project is expected to be about US $165 million. Peak rare company has obtained the lease right of 19 hectares of project land for 250 years, and has obtained the environmental permit and planning permit for project construction.
Shenghe Resources Holding Co.Ltd(600392) said that if the project can be implemented smoothly, it will help to further consolidate the company's development foundation and optimize the company's global business layout.
The reporter of the daily news has paid close attention to the success of the rare earth project.
At present, rare earth resources are the pastry of the capital market. On the one hand, the volume and price of rare earth market rose together. On the other hand, the performance of relevant listed companies was good, which confirmed the boom logic.
Shenghe Resources Holding Co.Ltd(600392) on the evening of January 14, the company issued an announcement on the pre increase of performance in 2021. The company expects to realize the net profit attributable to the shareholders of the listed company from 1.05 billion yuan to 1.2 billion yuan in 2021, an increase of 727 million yuan to 877 million yuan compared with the same period of last year, an increase of 225% to 271% year-on-year; It is estimated that the net profit after non deduction will increase by 948 million yuan to 1098 million yuan compared with the same period of last year, with a year-on-year increase of 1323% to 1532%.
However, for this acquisition, Shenghe Resources Holding Co.Ltd(600392) also suggests risks, including the risk of price fluctuation of rare earth products, the risk of changes in laws and regulations, the risk of transaction review, etc.
