Archer Materials Ltd (ASX:AXE, OTC:ARRXF) shareholders can increase their exposure to some of the company’s former assets thanks to a newly minted initial public offering (IPO).
Up until mid-this year, the materials technology company owned two Eyre Peninsula properties — the Kimba Kaolin/Halloysite Project and the Jamieson Tank Manganese Project — but recently passed them on to ChemX Materials Ltd, formerly known as NextGen Materials Ltd.
Thanks to that transaction, Archer landed 9.25 million ChemX shares and is entitled to a further 2.32 million securities once the company completes its IPO.
Now, ChemX’s IPO is open — and eligible Archer shareholders can get in on the action under a priority offer.
As it accelerates towards an ASX listing — planned for December 20 — ChemX is out to issue as much as 40 million shares at A$0.20 apiece to raise up to A$8 million.
With the funding runway under its wing, ChemX intends to build a pilot-scale high purity alumina plant and advance exploration over the newly acquired Eyre Peninsula assets.
Tenement sale
In June, Archer handed over its Wadikkee and Carappee Hill tenements to the former NextGen Materials.
Initially, the buyer paid A$150,000 to confirm the transaction, and Archer received A$18.5 million worth of shares to complete the buy.
Archer is also entitled to receive an additional bonus payment, equal to 5% of ChemX's enterprise value once it hits the ASX.
Finally, there’s a 2% net smelter return royalty on the value of all minerals (excluding graphite) extracted from the newly minted ChemX tenements.
A new era
Thanks to the Eyre Peninsula tenement sale, Archer is free to focus on its tech endeavours.
At present, AXE is the only ASX-listed company that gives investors exposure to the fast-growing world of quantum computing.
Archer is working on a world-first quantum computing qubit processor chip, known as 12CQ.
It’s working to validate the tech’s global competitive advantage, which includes integration and end-use in mobile devices.