SYDNEY, AUSTRALIA: EQ Resources Limited (EQR), an Australian company focused on tungsten mining and processing, announced on Tuesday that it has signed a share purchase agreement (SPA) to acquire Saloro S.L.U., a Spanish company that owns and operates the Barruecopardo tungsten mine, for $25 million.

The seller is Tungsten Mining JV S.L.U., a portfolio company of funds managed by Oaktree Capital Management L.P. (Oaktree), a global investment firm.

As part of the transaction, Oaktree will also subscribe for 278 million new ordinary shares in EQR at an issue price of $0.09 per share, representing a 30% premium to the 15-day volume-weighted average price (VWAP) of EQR shares. This will amount to an investment of $25 million and will give Oaktree a 15.86% stake in EQR at completion of the transaction. Oaktree will also receive 78 million options, with an exercise price of $0.10 per share, exercisable during the period of two years following the completion of the SPA.

EQR’s Chief Executive Officer, Kevin MacNeill, said that the acquisition of Saloro is a transformational deal for EQR that will deliver a huge value opportunity for shareholders. He said that EQR will add the leading European tungsten producing mine to its project portfolio, which aligns with its corporate strategy to become a substantial and globally leading supplier of sustainably produced critical minerals. He also said that EQR will provide technical assistance to Saloro to optimize production and explore the potential of the historical workings around the Barruecopardo mine.

MacNeill also welcomed Oaktree as a new substantial shareholder in EQR and said that Oaktree’s investment demonstrates its commitment to the value proposition of the expanded operation across two jurisdictions. He said that Oaktree is a high-profile globally significant fund that shares EQR’s operational excellence and environmental, social and governance (ESG) values.

Federico Alvarez-Demalde, Managing Director at Oaktree, said that Oaktree is excited to have selected EQR as partner to acquire Saloro. He said that EQR is a remarkable partner that is committed to responsible and sustainable practices and has demonstrated the ability to create lasting value while positively impacting society and the environment. He also said that Oaktree believes in the incredible opportunity presented in the tungsten supply space and the need to secure sustainable and ESG-focused critical metals supply chains.

The transaction is expected to close during the fourth quarter of 2023, subject to customary closing conditions. The SPA and other related documents are available on the websites of EQR and Saloro.

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