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Neo Announces Agreement to Sell Majority Equity Interest of China Rare Earth Separation Assets for USD $30 Million in Cash
Neo Announces Agreement to Sell Majority Equity Interest of China Rare Earth Separation Assets fo...
About this update from Neo Performance Materials, Inc.
[{"type":"text","content":"\n\n\n\n Neo Announces Agreement to Sell Majority Equity Interest of China Rare Earth Separation Assets for USD $30 Million in Cash\n \n\n /* Style Definitions */\nspan.prnews_span\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\na.prnews_a\n{\ncolor:blue;\n}\nli.prnews_li\n{\nfont-size:8pt;\nfont-family:\"Arial\";\ncolor:black;\n}\np.prnews_p\n{\nfont-size:0.62em;\nfont-family:\"Arial\";\ncolor:black;\nmargin:0in;\n}\n \n\n\n\n\n\n Canada NewsWire\n \n\n\n\n\n Purchaser is an integrated rare earth mining and separation industry leader, supporting growth potential and scale of assets\n \n\n Neo to retain exclusive distribution rights for JAMR's premium heavy rare earth products to international customers\n \n\n\n\n\n TORONTO\n \n\n ,\n \n\n Aug. 20, 2024\n \n\n /CNW/ - Neo Performance Materials Inc. (\"\n \n Neo\n \n \" or the \"\n \n Company\n \n \") (TSX: NEO) announced today that it has entered into agreements (the \"\n \n Transactions\n \n \") to sell (i) 86% equity interest in Jiangyin Jiahua Advanced Material Resources Co., Ltd. (\"\n \n JAMR\n \n \") to Shenghe Resources Holding Co., Ltd (\"\n \n Shenghe\n \n \") for approximately USD\n \n $25.6 million\n \n cash; and (ii) 100% of the equity in Zibo Jiahua Advanced Material Resources Co., Ltd. (\"\n \n ZAMR\n \n \") to Shenghe for approximately USD\n \n $4.1 million\n \n cash. JAMR sales proceeds represent a 10.7x multiple on average trailing five-year EBITDA for the facility. The ZAMR facility was valued using an asset-based approach, as the facility was closed in the second quarter of 2024.\n \n\n\n\n\n\n\n\n\n The Company will retain a 9% equity interest in JAMR following the closing of the Transactions and will execute an agreement securing the exclusive right to distribute JAMR's heavy rare earth products outside of\n \n China\n \n for an initial term of 5 years. This is expected to provide the Company's customers outside of\n \n China\n \n with continuity of supply for premium products like dysprosium for multi-layer ceramic capacitors and medical-grade gadolinium.\n \n\n\n \"As the rare earth industry in\n \n China\n \n has evolved, this is the right time to transition our rare earth separation businesses inside\n \n China\n \n to an integrated rare earth industry leader. It is our view that larger production and sourcing scale is required to create mor...