Australian Rare Earth Consortium Purchases 19 Billion ASM Common Shares... "Contributing to Korean Supply Chain"

Investment Moves Four Days After Completion of Korean Corporation's Ochang Plant

David Woodall, CEO of ASM, a rare earth and rare metal processing company in Australia. (Photo by ASM)

[Asia Economy Reporter Moon Chaeseok] The Korean consortium of Australian company ASM, which processes rare earth and other rare metals, announced on the 16th that it will purchase ASM common shares worth 15 million USD (approximately 19.2 billion KRW). This comes just four days after ASM Korea Corporation completed the construction of its Ochang plant in Chungcheongbuk-do on the 12th. It is expected that the stability of the domestic raw material supply chain will improve. The issue price is 8.9 Australian dollars per share (approximately 7,891 KRW).

ASM Holdings is a company located in Dubbo, New South Wales, Australia, and is the holding company of the Dubbo Project that supplies rare earth and other metals to Korea. KSM Metals is ASM’s Korean subsidiary.

ASM and KCF Energy have agreed to negotiate the investment contracts for ASM, ASM Holdings, and KSM Metals on a 'non-exclusive basis.' They will also negotiate a five-year purchase contract for the supply of neodymium-iron-boron alloy. Specifically, the agreements include ▲a strategic investor (SI) acquiring a 10% stake in ASM Holdings for 125 million USD (approximately 160.2 billion KRW) ▲obtaining shareholder approval for an additional ASM equity investment of 105 million USD (approximately 134.6 billion KRW) ▲issuing convertible bonds worth 50 million USD (approximately 64.1 billion KRW) to acquire a 30% stake in KSM Metals. The revised agreement replaces the previous agreement’s investment of 250 million USD (approximately 320.7 billion KRW) for a 20% stake in ASM Holdings. An ASM official stated, "The revised basic agreement will provide ASM with the flexibility needed to secure strategic partners suitable for the Dubbo Project."

ASM expects the transaction to take place around mid-next year, coinciding with the completion of the Dubbo Project development work with Hyundai Engineering. According to the agreement, negotiations for a five-year purchase contract for production from ASM’s Korean metal plant will continue.

David Woodall, CEO of ASM, said, "We have agreed to continue discussions with our Korean partners not only on the Dubbo Project but also on the conditions for ASM’s 'mine-to-metal' business development, and we welcome our partners’ investments in ASM." He explained, "This transaction represents a phased investment in ASM, ASM Holdings, and KSM Metals, demonstrating significant progress in ASM’s business in Korea." He added, "The Korean government and partners, who actively support ASM’s strategy, are eager to secure metal supplies necessary for the development of Korean manufacturing. ASM will supply strategic metals, including deliveries from the first metal plant in Korea, which was completed on the 12th."