MinRex Resources Ltd. said March 26 that it agreed to acquire three project areas prospective for cobalt, scandium, copper and nickel in New South Wales and Western Australia by acquiring the issued share capital of Clean Power Resources Pty. Ltd.
Clean Power holds the tenement applications for the Pacific Express cobalt-scandium-nickel project in New South Wales and the Dragon and Knight cobalt-copper-nickel projects in Western Australia.
Subject to due diligence, the company will pay A$100,000 and issue 1 million shares upon signing the deal. It will then issue 29 million shares to Clean Power's shareholders, with an attached option to acquire 1 share for every 2 shares held at 15 cents each for up to three years.
In addition, MinRex will issue 13,350,000 shares upon meeting resource-based milestones on the projects and reimburse rental fees and bonds paid by Clean Power over the tenement areas.
Clean Power's shareholders, which will account for about 24.65% of MinRex upon closing, will also retain a 2% net smelter returns royalty on all minerals produced and sold from the three tenements.
The deal is expected to be settled by the end of May.