Lindian Resources surges 23% after acquiring rare earths facility
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The news: Small cap rare earths miner Lindian Resources has seen its share price surge in afternoon trade after announcing plans to acquire a mixed rare earths carbonate (MREC) from a joint venture between Sumitomo Corporation and uranium producer Kazatomprom.
The numbers: Lindian, along with Kazakhstani joint venture partner RA-Group (49%), have signed a binding term sheet to acquire 100% of the Summit Atom Rare Earth Company Arctic MREC processing facility and associated infrastructure for USD15 million ($21.1 million).
Lindian is paying USD7.65 million of the consideration price while RA is paying USD7.35 million.
This consists of an initial USD3 million consideration and a deferred consideration of USD12 million after plant operations begin, expected in the first half of 2027.
At 3:35pm AEDT, shares in Lindian Resources had lifted 25.5% to 66 cents each. They are up 565% over the last year.
The context: The facility, which is operational, will enable Lindian to produce higher value MREC on top of the rare earth concentrate it expects to produce from its Kangankunde project in Malawi from the fourth quarter of 2026.
Lindian executive chair Robert Martin said the acquisition price for a “fully constructed, operational cracking facility for USD15 million, compared to over half a billion dollars typically required for greenfield downstream development”, avoids significant costs and development time.
What they said: “This downstream capability strengthens our negotiating position on all offtake discussions and expands our addressable customer base as we move toward dual production in 2026,” Lindian executive chair Robert Martin said.
Shareholder Wilson Asset Management deputy portfolio manager Shaun Weick told Capital Brief the acquisition positions Lindian well to compete against Lynas Rare Earths and US-based MP Materials.
He also suggested the facility could significantly uplift the company’s annual EBITDA and hence its valuation.
“If you look at it from a valuation perspective, and the economics of the deal, Phase one [of Kangankunde], they’re fully funded for production in nine months, doing around about $200 million of EBITDA which you know, over the next sort of 12 to 18 months, will step up to sort of $900 million of EBITDA with the downstream processing capacity,” Weick estimates.
The source: ASX
