Rare Earths Global Limited Agreement with TRSICL (4795Q)

TIDMREG

RNS Number : 4795Q

Rare Earths Global Limited

15 October 2013

 
 15 October 2013 
 

Rare Earths Global Limited

("REG" or the "Company")

Agreement with Tianjin Ruixiang Stone Investment Company Limited ("TRSICL")

Rare Earths Global Limited (AIM: REG), a leading mining services group focused on the extraction, separation, refinement and trading of rare earth elements, oxides and other related products, is pleased to announce that it has agreed a transaction with TRSICL with the intention to expedite securing the relevant rare earth production/export quotas and licences in China. TRSICL are a private Chinese investment Company with a wealth of experience in the resources sector in China and have an excellent track record in dealing with local Government and securing licences and quotas across various resource types. TRSICL employs over 250 people including 60 engineers with expertise in mining design, extraction, management and license application. The key terms of this agreement are as follows:

-- TRSICL will acquire 30% of the share capital of Long Era Limited (a subsidiary of REG that owns the Company's separation plant at Sanxie) in two equal tranches for a total cash payment of RMB12 million. The first tranche of RMB 6 million is transferable immediately and the second tranche of RMB 6 million shall be payable before 31 March 2014.

   --     In terms of the agreement, TRSICL has undertaken to secure: 

-- a production quota of no fewer than 300 tonnes for our plant at Sanxie for 2014;

-- an export quota of no fewer than 150 tonnes for our plant at Sanxie for 2014;

-- approval from all the relevant government authorities to expand production at the Sanxie plant to 3,000 tons per annum in order to meet all requirements under the Chinese White paper in 2014.

-- If TRSICL does not meet any of its agreed obligations set out above the Company can elect to re-purchase the 30% interest in Long Era Limited at the original consideration.

-- TRSICL shall have the right to appoint 2 directors to the Board of Long Era Limited out of a total of 6.

The Board believe that this Agreement provides the Company with an outstanding opportunity to enable REG to obtain the relevant quotas and licences in the short term. We will now begin work in earnest with TRSICL at Sanxie and look forward to updating shareholders on our progress as soon as possible.

- Ends -

For further information:

 
 Rare Earths Global Limited 
 Simon Ong, Chief Executive          Tel: [phone] 
  Officer                                         6388 
 Brian Ho, Finance Director   www.rareearthsglobal.com 
 
 
 Charles Stanley Securities 
 Nominated Adviser & Broker 
 Dugald J. Carlean / Carl           Tel: +44 (0) 20 
  Holmes                                  7149 6000 
                              www.csysecurities.com 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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