Mining Stock News Bite – Aclara Resources Inc. (TSX: ARA) Makes TSX Top Gainers List on News of US$80M Strategic Investment by Cap in Its Chilean Subsidiary


March 13, 2024 ( Newswire) Mining Stock News Bites – Aclara Resources Inc. (TSX:ARA) made the top gainers list on the TSX trading at $0.5100, gaining $0.1200 for a win of 30.7692% following news. The stock had a day’s high of $0.57.

Aclara announced that it has entered into an investment agreement with CAP S.A. (“CAP”), a publicly listed company on the Chilean Stock Exchange, pursuant to which, amongst other things, CAP will make a US$29 million strategic investment in REE Uno SpA (“REE Uno”), Aclara´s Chilean subsidiary, which owns the Penco Module (the “Investment Agreement”). Under the terms of the Investment Agreement, CAP also has an option to invest an additional US$50 million in REE Uno and a three-year option to subscribe a 19.9% interest in Aclara, and the parties have also agreed to form a joint venture company to develop metals and alloys for the rare earths permanent magnet industry (the “Transaction”). The Transaction reflects the parties’ shared view that the future will require innovative mineral extraction methods, a strong focus on environmental and social sustainability, and the understanding that our planet requires cleanly produced rare earths metals in its urgent fight against climate change.


CAP S.A., a company with more than 77 years of history and listed in the Chilean Stock Exchange since 1987, is the parent company of the CAP Group, a Chilean conglomerate operating in various industries including iron ore mining (CMP), with mines and industrial operations in the north of the country, as well as steelmaking operations in Concepcion (Huachipato), very close to the Penco Module. CAP is one of the leading high-grade iron ore producers in the world with four operating mines in Chile. In addition, CAP has several steel product manufacturing plants in Chile, Peru and Argentina. It operates five ports, a seawater desalination plant and has vast industrial infrastructure in the Biobio region. Huachipato has been operating since 1950, and together with SMS Group is developing a project for sustainable steel using green hydrogen for the direct reduction of iron. CAP has a strong connection with the people of the Biobío region, where it has been a major employer for several decades, contributing directly to the development of the south of Chile.

Transaction Summary

A US$29.1 million capital contribution by CAP into REE Uno, Aclara´s Chilean subsidiary which owns the Penco Module and all of Aclara´s mining concessions in Chile, in exchange for a 20% equity participation in REE Uno. Payments will be made in three tranches with the initial tranche of US$9.7 million to be made upon closing of the Transaction, the second payment of US$12.5 million in January 2025 and the remaining balance of US$6.9 million to be made in January 2026. This initial investment represents a pre-money valuation of REE Uno of US$116.5 million.


An option to invest an additional US$50 million in REE Uno for an additional 20% equity interest in REE Uno once the requisite environmental permit is secured for the Penco Module. Upon completion, this additional investment would allow CAP to attain a 40% equity interest in REE Uno. This second investment represents a pre-money valuation of REE Uno of US$150 million.

A three-year option to invest up to 19.9% in Aclara by participating in any private placement or public offering of shares that Aclara may make during the next 36 months, including a residual top-up right to maintain pro rata voting rights. Any subscription to such private placement or public offering will be made on the same terms offered by Aclara to other investors. CAP will have the right to nominate one board member upon attaining and for so long as its equity interest in Aclara amount to at least 15% of the issued and outstanding common shares of Aclara. In addition, CAP holds a one-time demand subscription right to invest up to an aggregate of 19.9% in Aclara, exercisable upon the satisfaction of certain conditions and continuing for a maximum period of 18 months counted from the end of the initial 3-year option.

The formation of a 50/50 joint venture to develop metals and alloys for the rare earths permanent magnet industry. CAP will invest US$3.0 million in exchange for its 50% of the shares of the newly established joint venture company. Aclara will own the other 50% of the shares.


Closing of the Transaction is subject to the performance of certain customary closing conditions, which the parties expect to complete within the next 30 days.

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