Tasman Metals and Flinders Resources to Merge

Published: May 16, 2016 |

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Discussions with regard to a potential merger of Tasman Metals Ltd. and Flinders Resources Limited have resulted in an agreement in principle to complete a merger. It is proposed that the combined company, should the potential merger be successful, be known as Kinetic Materials Corporation.

The potential merger will consolidate Flinders’ and Tasman’s key assets and technologies in the critical metals arena and bring together a management and board team with deep experience in the discovery, development and marketing of these materials. It is believed that the experience of the team in the rare earth element (REE) and graphite sectors will provide insight into where best to position the combined company to gain access to these emerging markets. Substantial overlap exists between REE and graphite customers, and both materials are considered “critical” by the European Commission under the DG Growth “Raw Materials Initiative”.

The management teams of Flinders and Tasman believe that with the current “once in a generation” transition to a low-carbon economy, a shift in the material requirements of energy generation is occurring and the need for new materials is accelerating. It is anticipated that a merged entity will provide a larger market presence and deliver operational efficiency through shared technological, logistical, administrative and marketing activities. A merger of Tasman and Flinders would combine advanced assets to make a well-balanced and secure company, while strengthening the voice of the combined company and allowing for greater access to research, capital markets and customers.

The respective boards of directors of Flinders and Tasman believe the project portfolios of the two companies have been significantly advanced since May 2014, when a previous discussion regarding a potential merger were terminated.

Flinders has developed the Woxna flake graphite deposit in central Sweden, with the fully-permitted project on production-ready status. Flinders is now working to add value to various graphite materials including high purity spherical graphite for lithium ion batteries and graphene for electrodes, barriers and coatings.

Tasman published a preliminary feasibility study (PFS) for the company’s Norra Karr REE deposit in Sweden in 2015. This PFS confirmed that Norra Karr has the capacity to be a long term producer of the most critical heavy REEs, plus other critical metals including zirconium and hafnium. Furthermore, Tasman recently completed test work on nepheline/feldspar by-product from Norra Karr, which presents a potential opportunity to supply an industrial commodity to Europe’s large paint, building product, ceramic and glass markets.

Should Flinders and Tasman determine to proceed with the proposed merger, it is currently proposed that Flinders will acquire under a statutory plan of arrangement 100 percent of the outstanding common shares of Tasman.

With extensive experience in mine development and operations, Flinders’ President and CEO Blair Way will take on the role of president and CEO of Kinetic. Mark Saxon, Tasman’s president and CEO, will assume the role of executive director - Strategy and Technology, and continue to provide his wealth of knowledge in the critical metals space. The remaining board composition will be determined at a later date.

“With the benefit of extensive experience in the critical metals sector, the boards of Tasman and Flinders have recognized the opportunity provided by the accelerating shift to low-carbon energy supply and efficient energy storage. A whole new set of metals and materials that provide a higher level of performance are now in demand. This consolidation of companies caters to the future demand for functional materials from environmentally and socially sustainable sources, which we believe provides Kinetic with a very exciting future,” said Mark Saxon, Tasman’s president and CEO.

“The combination of Flinders and Tasman to form Kinetic can provide Europe with a potential sustainable supplier of the raw materials required for the low-carbon energy generation and storage. Should the merger proceed, it is anticipated the combined company will focus on the development and permitting for high purity spherical graphite production at Woxna, product development for the array of critical metals and materials available at Norra Karr, and the acquisition of aligned projects and technologies. With rare earth element prices remaining subdued, expenditure on REE processing at Norra Karr will be on an as needed basis, however processing research with the financial support of the European Commission funded EURARE project shall continue,” said Blair Way, Flinders’ president and CEO.

To stop by Tasman’s website, CLICK HERE

To stop by Flinders’ website, CLICK HERE

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