American Rare Earths knocks back Halleck Creek Rare Earth Project acquisition proposal

Published: 01:20 26 Apr 2024 BST

American Rare Earths Ltd (ASX:ARR, OTCQB:ARRNF) has received a proposal to acquire its 2.34 billion tonne Halleck Creek Rare Earth Project in Wyoming.

The indicative, conditional and non-binding proposal is from a Nasdaq-listed Special Purpose Acquisition Company (SPAC) to acquire, by an issue of shares, the company’s 100% owned subsidiary, which holds the Halleck Creek Project. The proposal, if accepted, would have resulted in Wyoming Rare (USA) Inc. being listed as a separate entity on the Nasdaq Exchange in the USA.

ARR says it is aware of the potential benefits of this type of proposal, as it follows a similar successful pathway of MP Materials, which also achieved listing of Mountain Pass.

A need to maximise returns

However, the board is mindful of the significant potential of Halleck Creek, and the need to maximise returns to shareholders, while minimising dilution and has declined to advance at this time.

ARR says it will continue to evaluate all strategic alternatives to “ensure optimal returns to its shareholders”, particularly after reaching certain near-term operational milestones that will provide investors further confidence in the significant value that it believes is presented by Halleck Creek.

American Rare Earths chair Richard Hudson said: “The inbound interest received in American Rare Earths underscores the immense value and strategic significance of our Halleck Creek Rare Earth Project.

"As we navigate potential pathways for growth, including the recent proposal from a Nasdaq-listed SPAC, we remain committed to maximising returns for our shareholders while advancing our mission of sustainable resource development.”