Alien Metals increases shareholding in Hamersley Iron Ore to over 90%

LONDON: Alien Metals Ltd has executed a conditional Share Sale Agreement (SSA) to increase its effective interest in the Hamersley Iron Ore Direct Shipping Ore (DSO) Project, situated in the world-class Pilbara region of Western Australia from 51% to over 90%.

Bill Brodie Good, CEO & Technical Director of Alien Metals, commented: “The excellent initial assay results we’ve seen from our maiden drilling program on the Hancock licence, recent field work carried out on both licences, and along with the continued surge in demand and price for Iron Ore, have underscored the rationale for this acquisition and we are delighted to be increasing our stake in the Hamersley Project to over 90%. By obtaining the major controlling interest, we will have greater flexibility to both manage and monetise the Project as our continued exploration moves it up the value curve.

“Iron ore has recently broken through the US$200 per tonne barrier, driven largely by global infrastructure demand and stimulus spending as economies look to shake off the COVID-19 economic slump. These factors are showing no sign of slowing as global demand for Iron Ore continues to rise and we see continued resilience in the price. Against this backdrop, we feel this Acquisition is highly value accretive for the Company and will deliver significant value for shareholders.

“The Company is in the process of commencing a follow-up drill program on the Hancock licence with a view to generating a maiden JORC compliant resource and, once permits have been received, we will commence our maiden drill program at the Brockman licence as well, which contains historic BHP iron prospects and remains an exciting licence in its own right.”

Transaction Terms

 Alien currently has a 51% direct interest in the Project, with the remaining 49% held by Windfield. The Project consists of exploration licence EL47/3953 Brockman and EL47/3954 Hancock licences in the Pilbara region of Western Australia. Pursuant to the SSA with Windfield, Alien will acquire an 80% interest in Windfield, thereby bringing Alien’s direct and indirect holding in the Project to 90.2%. Alien has agreed to acquire Windfield on the basis that its sole asset will be the interest in the Project and on a nil net cash basis

 1. The Upfront Consideration payable for the transaction is set out below subject to satisfaction of the conditions precedent including Alien conducting legal, financial and operational due diligence on Windfield and being satisfied, in its discretion, with the outcome of that due diligence:

a. £60,000 cash (less any Set Off Amounts);

b. 200,000,000 UFO shares issued at a deemed price of 1.1 pence each (“Deemed Issue Price”); and

c. 50,000,000 share purchase warrants, exercisable at 1.65p to the Deemed Issue Price payable to the advisers to the transaction.

2. Following completion, Alien will appoint 2 directors to the board of Windfield and will be responsible for day-to-day management.

3. Alien will free-carry the shareholder in Windfield (effectively a free carry of 9.8%) until completion of a Bankable Feasibility Study on either the Brockman or Hancock Ranges projects.

4. If, within 24 months of executing the SSA, Alien disposes of its interest in Windfield or Windfield’s interest in the Project, the Company will pay the Windfield seller a performance payment in addition to the Upfront Consideration (“Performance Payment”).

5. The Performance Payment is calculated by:

a. In the event of a Tenement Sale: 50% of the value uplift attributable to the Projects; or

b. In the event of an IPO/Spin-out event: 50% of the value uplift attributable to Windfield 

Windfield’s sole asset is the 49% interest in the Project and in the year to 30 June 2020 it reported minimal revenue, a loss before tax of A$191,573 and Net Assets as at 30 June 2020 of A$191,473.

www.alienmetals.uk,

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