28th Jun 2023 10:52
Rainbow Rare Earths Ltd - South Africa and east Africa-focused producer of rare earth oxides - Signs a deal with Bosveld Phosphates Ltd, permitting 100% ownership of the Phalaborwa Project in South Africa. Rainbow says it will get an immediate 85% interest in the unincorporated joint venture that holds the rights to Phalaborwa, with Bosveld holding the remaining 15%. Says it will pay Bosveld USD5.0 million in cash in July under the terms of the deal. Additionally, Rainbow says under the deal, it is being granted a call option to buy the remaining 15% of the JV owned by Bosveld, in return for USD7.0 million of equity in Rainbow. This could happen at any time from October 31 to December 31, 2025. Says shares issued according to the call option will be subject to a 24-month lock-up.
Chief Executive Officer George Bennett says: "This is an exciting time for Rainbow and Phalaborwa, with the front end of the pilot plant operational in South Africa and the back end being constructed in US. I look forward to announcing the results from the front end pilot testing, confirming we are able to extract the rare earths and produce a saleable mixed rare earth sulphate."
Current stock price: 8.60 pence each, up 1.2% on Wednesday morning in London
12-month change: down 33%
By Xindi Wei, Alliance News reporter
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