Power Metal Resources plc has added secondary source extraction to its portfolio with a conditional £1 million acquisition of 75% of GSA (Environmental) Ltd (GSAe).
AMBITIOUS
Based in the North Lincolnshire town of Brigg, GSAe is an engineering technology provider and process licensor.
The company specialises in extraction of “strategic metals” from sources such as power station ash, refinery waste, titanium dioxide waste and spent catalysts, while producing “more environmentally friendly residue”.
The binding heads of terms, for a maximum £1m payable in cash and/or new ordinary shares, will see Power Metal pay an initial £75,000 through issuing new ordinary shares of 0.1p each in the company.
Subsequent payments are subject to GSAe achieving performance milestones including a year three annual profit of at least £1m.
Completion of the transaction is conditional upon completion of due diligence by Power Metal and other customary pre-conditions.
Should all conditions precedent not be satisfied within 30 days, Power Metal can terminate the deal at its sole discretion.
The company said that from 1 June 31 December 2023, GSAe’s unaudited records showed profit of £156,680, gross assets of £242,401 and net assets of £40,387.
Chief executive officer Sean Wade added: “We have ambitious plans for this innovative business and believe that the extraction of strategic metals from waste products fits well with our strategy of seeking exposure to the critical metals needed for the global energy transition.
“GSAe’s proprietary technology has wide application, including in Saudi Arabia, with its plentiful supply of metal-rich power station ash.
“We believe this acquisition represents a significant step forward in our efforts to become a major operator in the region.
“Moreover, the directors believe the acquisition will also create a substantial revenue opportunity for Power Metal shareholders, which if successful, will allow us to fund our activities with less recourse to dilutive equity financing.”