Tungsten Mining NL Acquires Full Ownership of Hatches Creek Tungsten Project
TUNGSTEN MINING NL (TGN) Share Update August 2024 Monday 5th
Tungsten Mining to Fully Acquire Hatches Creek Tungsten Project
Australian tungsten developer, Tungsten Mining NL (ASX:TGN), has announced an agreement to acquire the remaining 80% interest in the Hatches Creek Tungsten Project from GWR Group Ltd, positioning itself for significant growth in the tungsten market.
Instant Summary:
- Tungsten Mining NL (TGN) to acquire GWR Group's remaining 80% interest in Hatches Creek Tungsten Project.
- TGN will hold 100% ownership of the project after completion.
- The project has multiple high-grade polymetallic tungsten prospects.
- Consideration includes issuing 107.5 million fully paid ordinary shares in TGN to GWR Group.
- GWR's voting power in TGN to increase to approximately 19.86%.
- Agreement subject to Ministerial consent under the Mineral Titles Act 2010 (NT).
Acquisition Details
Tungsten Mining NL (ASX:TGN) has executed an agreement to acquire the remaining 80% interest in the Hatches Creek Tungsten Project from its joint venture partner, GWR Group Ltd (ASX:GWR). This acquisition will give TGN full ownership of the project, which is located 325 km north-east of Alice Springs and 160 km south-east of Tennant Creek in the Northern Territory.
The Hatches Creek Tungsten Project has confirmed multiple high-grade polymetallic tungsten prospects and demonstrated potential for a high-grade tungsten deposit. The area remains largely unexplored, offering significant opportunities to expand the resource.
Consideration and Terms
As consideration for the acquisition, TGN has agreed to issue GWR Group 107.5 million fully paid ordinary shares in TGN at a deemed issue price of $0.08 per share. This issuance will increase GWR's voting power in TGN to approximately 19.86%. The shares will be issued under TGN’s placement capacity without requiring shareholder approval.
The agreement is subject to Ministerial consent under the Mineral Titles Act 2010 (NT). The parties have obtained confirmation from the Central Land Council that no further consents or approvals are required for the purposes of the agreement.
Project Background
TGN, through its wholly owned subsidiary Territory Tungsten Pty Ltd, initially acquired a 20% interest in the project in May 2019. Since then, TGN has been sole funding the project's activities. The project area includes Exploration Licences 22912 and 23463, and Exploration Licence Application 31469.
The agreement contains usual terms for such transactions, including representations and warranties and obligations on GWR to maintain the assets in good standing pending completion. Completion will occur three business days after satisfaction of the conditions precedent.
This acquisition positions Tungsten Mining NL to capitalize on the strong tungsten market by having full control over the Hatches Creek Tungsten Project. The issuance of shares to GWR Group will result in a significant increase in GWR's voting power in TGN, which may influence future company decisions. The potential for high-grade tungsten deposits and the largely unexplored area present substantial growth opportunities for TGN.
Investor Reaction:
Analysts are likely to view this acquisition positively, given the potential for resource expansion and the strategic importance of tungsten. The increase in GWR's voting power in TGN may raise some concerns among investors about future governance, but overall, the market is expected to react favorably to the news.
Conclusion:
Investors should keep an eye on the progress of the acquisition and the subsequent exploration activities at the Hatches Creek Tungsten Project. The full ownership of the project places TGN in a strong position to benefit from the growing demand for tungsten. Monitoring the company's strategic moves and resource development will be crucial for making informed investment decisions.