Saudi Arabian Mining Company (Ma'aden) has announced that it has entered into an agreement with US group Ivanhoe Electric (IE) to set up a joint venture company to explore minerals including copper, gold, nickel and silver in the kingdom. 

 

Ivanhoe Electric is a NYSE-listed mineral exploration and development company in the US that combines advanced mineral exploration technologies, renewable energy storage solutions and electric metals projects.

 

As part of the deal, the Saudi group will acquire a 9.9% equity interest in the American group for $126 million.

 

This is a vital investment for Ma'aden giving it strategic presence in a leading international mining company with its own proprietary technology and increasing its international exposure to critical minerals, said senior company officials at the Heads of Terms signing ceremony held on the sidelines of Future Minerals Forum in Riyadh, Saudi Arabia.

 

Under the transaction terms, Ma'aden will obtain the right to appoint one independent director to the Ivanhoe Electric's Board of Directors and will be issued with approximately 10.2 million new common shares in IE at a price of $12.38 per share.

 

The Saudi mining group said the joint venture will explore 48,500 sq km of selected licenses areas that demonstrate excellent potential. 

 

Through the JV, Ma'aden will obtain royalty free access to IE's proprietary Typhoon technology, which conducts geophysical surveys using high powered transmitters to detect the presence of sulfide minerals containing copper, nickel, gold and silver. 

 

This will help accelerate, de-risk and advance Ma'aden's exploration lands being made available to the joint venture, thereby enabling Ma'aden to realize value from its exploration assets.

 

CEO Robert Wilt said: "Ma'aden's strategic investment in Ivanhoe Electric is a critically important moment in our journey to become a leading supplier of strategic minerals, which will fuel global economic growth over the coming decade."

 

"Through Ma'aden, Saudi Arabia is making an invaluable contribution to fast-developing new industries across the world characterized by technological advancement," he noted.

 

Ivanhoe Electric's Executive Chairman Robert Friedland said: "We are proud to partner with Ma'aden and the amazing young motivated women and men of Saudi Arabia on this journey to explore the significant mineral wealth of the Kingdom, especially with the blessings our collaboration may bring to realizing Vision 2030."

 

IE will commit $66 million from funds raised through the share subscription to the joint venture to fund the purchase of three new generation Typhoon machines and the exploration of prospective lands to be provided by Ma'aden for metallic minerals within the Kingdom, he added.

 

Ma'aden said the deal is expected to be completed by the end of Q1. It is being advised in this transaction by M. Klein and Company.-TradeArabia News Service