Australian Silica Quartz Group Limited (ASX: ASQ), a minerals exploration and development company, has announced its entry into a Sale and Purchase Agreement to acquire private exploration company Australian Kaolin Pty Ltd (AKL). This acquisition includes AKL’s wholly-owned White Swan Kaolin Project, strategically located 35 kilometres from the Cape Class Port of Esperance in Western Australia. The consideration for the acquisition comprises 100 million fully paid ordinary ASQ shares, valued at a deemed issue price of 2 cents per share, equating to A$2 million.
The White Swan Kaolin Project boasts an Inferred JORC 2012 Mineral Resource of 47 million tonnes of kaolin, situated on a recently granted Mining Lease, ML 63/688. Australian Silica Quartz Group is actively pursuing a mining proposal for a 250,000 tonne per annum direct shipping ore (DSO) operation, currently under assessment by the Department of Mines, Petroleum and Exploration. The company plans a bulk sampling and DSO marketing program to engage potential offtake partners in Asia and other international markets, aiming to progress towards first export revenues.
The acquisition is subject to several conditions precedent, including Australian Silica Quartz Group shareholder approval. An Independent Expert will be appointed to assess the transaction’s fairness and reasonableness to unrelated shareholders. To fund the progression of the White Swan Kaolin Project towards export, ASQ has also received binding commitments for a A$750,000 placement at 2 cents per share, with participation from Directors and staff subject to shareholder approval. Furthermore, AKL Director Jamie Cullen is slated to join the ASQ board, and kaolin specialist James Marsh will continue as a consultant to AKL post-completion.
