Perth-based aspiring sulfate of potash (SOP) producer Reward Minerals Ltd. announced on March 18 that its proposed acquisition of the Beyondie SOP project in Western Australia has been terminated. The company said it was unable to secure sufficient funding to complete the acquisition and have adequate working capital available, despite an “exhaustive effort.”
In a separate ASX release, McGrathNicol, the receivers and managers of Beyondie’s former developer Kalium Lakes Ltd., confirmed that they have executed a termination deed with Reward after the SOP junior advised it was unable to secure sufficient funding for the transaction.
Reward had reached a binding share sale agreement with McGrathNicol in early December on a debt-free basis, free of encumbrances, for a total of A$20 million (approximately $31.1 million at current exchange rates) to acquire the Beyondie SOP project (GM Dec. 8, 2023).
Despite a failed capital raise via a 2-to-1 renounceable entitlement offer in January, through which Reward had hoped to raise A$22.785 million before costs to fund the acquisition (GM Jan. 12, p. 30), the aspiring SOP producer and the managers and receivers had still hoped to hammer out a deal. McGrathNicol said last month that it expected the sale transaction would be completed by mid-March (GM Feb. 23, p. 34).
According to McGrathNicol’s March 18 statement, Kalium Lakes Potash Pty Ltd. and Kalium Lakes Infrastructure Pty. Ltd. are now expected to enter liquidation in the coming days. An earlier attempt by the receivers and managers to sell Beyondie to another Western Australian SOP project developer, Agrimin Ltd., derailed after Agrimin pulled out of the proposed deal last October (GM Oct. 6, 2023).
Kalium Lakes was Australia’s first SOP producer, manufacturing its initial batch of SOP at Beyondie in October 2021, and had been targeting SOP production of 90,000-100,000 mt/y (GM Oct. 8, 2021). The company went into receivership in August 2023, however, after it failed to find further financial support for the continued development of the project (GM Aug. 18, 2023).
The suspension of trading in Reward’s securities on the ASX was lifted on March 18 following the Beyondie announcement. Reward had requested a voluntary trading halt on Feb. 8 pending an announcement on the transaction (GM Feb. 9, p. 32).
Reward in this week’s ASX statement said it intends to continue advancement of its processing technology toward commercialization while “conducting due diligence activities on new projects within the minerals sector for potential acquisition.”
Reward has two other potash projects in Western Australia, including its flagship Kumpupintil Lake Potash (formerly called Lake Disappointment Potash Project) east of Newman, and the Carnarvon Potash Project north of Carnarvon.