Chinese company to invest N$30m in Askari's Uis Lithium Project


A Chinese company, Huayou International Resources, will invest N$30m via a subscription for 4,5 million shares at an issue price of US$0.55 per share in the Askari Metals Namibian Uis Lithium Project.

Huayou will acquire indirect interests in EPL 7345 and EPL 8535 as approved by Askari Metals' shareholders at the general meeting on Feb. 20 2023. 

Askari Metals will use the funds raised from the deal to accelerate continued exploration at the Uis Lithium Project.

The strategic investment announced on March 22 is subject to a 12-month voluntary escrow period pursuant to a binding restriction agreement to be executed upon completion. 

Under the agreement, Huayou will have the opportunity to participate in future equity issues by Askari Metals. 

Huayou intends to grow its equity position in Askari Metals to 9.9% and maintain its equity stake by participating in future security issues.

Once Huayou holds a 9.9% equity stake in Askari Metals, it will have the right to appoint a nominee to Askari Metals'board.

Askari Metals executive director Gino DÁnna said having a tier-1 strategic investor such as Huayou adds credibility to our strategy in Namibia and supports our vision to identify a significant exploration discovery. 

D'Anna also said Huayou had demonstrated a willingness to invest in Africa, highlighted by its recent acquisition of the Arcadia Lithium Mine in Zimbabwe for US$422 million. 

“The name Huayou is synonymous with the cobalt and lithium sector in China and globally. Askari has maintained an aggressive and hands-on exploration approach at the Uis Lithium Project, launching a three-phase RC Drilling program across the two projects in November 2022.

"We’re aiming to demonstrate the potential scale of mineralisation at the Uis Lithium Project through drilling and exploration campaigns and lead the lithium charge in Namibia. 

"Accelerating our exploration efforts at the Uis Project supports our goal to deliver a maiden resource as quickly as possible. The Company looks forward to updating shareholders as exploration activities." 

Huayou International Resources is a subsidiary of Zhejiang Huayou Cobalt Co., Ltd, a leading manufacturer of new energy battery materials in China, and listed on the Shanghai Stock Exchange with a current market capitalisation of around US$12.8 billion. 

In April 2022, Huayou acquired the Arcadia lithium project in Zimbabwe for US$422 million. Arcadia's designed annual processing capacity is 4.5 million tons of ore, and the first production batch was successfully produced on March 20, 2023. 

Huayou also owns two copper and cobalt projects in the DRC, with an annual production of 100kt cathode copper and 10kt cobalt. 

The company has invested in three nickel and cobalt projects in Indonesia, with an expected annual production of 225kt of nickel and 23kt of cobalt in products by 2024. 

Huayou develops and refines battery metal resources using nickel, cobalt, and lithium, producing precursors, ternary cathode materials, and recycling battery materials. 

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