Sovereign Metals receives A$40.4 million investment from Rio Tinto

July 21, 2023

Thomson Geer has advised Sovereign Metals Ltd (ASX:SVM; AIM:SVML) on a A$40.4 million strategic investment by global mining giant Rio Tinto that will advance Sovereign's Kasiya rutile-graphite project, one of the world's largest natural rutile deposits, in Malawi, Africa.

Rio Tinto will take a 15 per cent stake in the company under the investment. It has also been issued with options to increase its shareholding to potentially 19.99 per cent of Sovereign within 12 months for another A$18.5 million.

Sovereign will use the funds from Rio Tinto to fund the advancement of the Kasiya project and its definitive feasibility study. Natural rutile is a form of titanium dioxide, used in paints, coatings and plastics and to produce titanium metal.

The companies will also work together to qualify Kasiya's graphite product with a particular focus on supplying the lithium-ion battery anode market.

Thomson Geer advised Sovereign on all aspects of the strategic placement and investment agreements, including co-ordinating with the cross border team of advisers and negotiating the transaction documents.

The Thomson Geer team was led by Partners Michael Bowen and Michael Ng with the support of Associate Lawrence Ward.

Michael Ng said: "We are pleased to have assisted Sovereign secure the significant investment by Rio Tinto in the company for the development of its Kasiya project. The move is a major step towards Sovereign's goal of bringing the Kasiya project on line."

Sovereign was also represented by financial adviser, SCP Resources Finance and UK law firm Simmons & Simmons.

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