Bushveld Minerals Limited (LON:BMN) has received clearance from South African authorities for its acquisition of a 78.8% stake in Strategic Minerals Corporation from Evraz Corp.
The company’s wholly-owned Bushveld Vametco Limited will pay a total US$14.8mln for the shareholding in Strategic Minerals after the South African Department of Minerals Resources approved the deal.
Bushveld said the deal will be completed on Friday.
The acquisition will be funded by a bridge loan facility of US$11mln with Barack Fund SPC Limited, a $3mln financing agreement with Wogen Resources Limited and a cash contribution of US$800,000 from Bushveld and Yellow Dragon Holdings Limited.
On Thursday Bushveld said it had secured the final funding needed to support its acquisition, agreeing a bridge loan facility with Barack Fund SPC Limited.
Chief executive, Fortune Mojapelo, said: "We are pleased to take yet another firm step towards the completion of SMC. We are grateful to the Department of Mineral Resources in South Africa for their professional and timeous processing of the regulatory approvals in terms of the Mineral and Petroleum Resources Development Act. We look forward to now complete the acquisition and launch in earnest our quest to build a significant low cost integrated vanadium platform."
Shares in Bushveld jumped 5.88% to 8.28p at midday trading.
Strategic Minerals owns the Vametco vanadium mine in South Africa.
SP Angel said: "This looks like a great deal for Bushveld, particularly considering the recovery in vanadium prices and future potential for the Vametco plant."
-- Adds share price reaction, broker comment --