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Bushveld successfully defends litigation

7th March 2022

By: Tasneem Bulbulia

Senior Contributing Editor Online

     

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Aim-listed Bushveld Minerals has reported on the outcome of litigation, saying the judgment vindicates the position that the investment by its subsidiary VRFB Holdings (VRFB-H) into Enerox Holdings (EHL), funded as it was partly from an investment by Mustang, was entirely appropriate and not in violation of any agreements.

Accordingly, the investment by Mustang into VRFB-H, and the investment by VRFB-H into EHL, continue to be in place.

As previously announced, Mustang's investment into VRFB-H constitutes a reverse takeover according to the Aim Rules. As such, Mustang shares will remain suspended while it prepares a prospectus on its investment into VRFB-H.

The judgment was handed down on March 7 in the High Court of Justice: Business and Property Courts of England and Wales (chancery division) in the matter between Garnet Commerce (claimant), VRFB-H and EHL (defendants) and 2289609 Alberta (a third party).

As announced on July 14, 2021, Garnet issued a claim form in the English High Court against VRFB-H and EHL.

EHL owns a 100% interest in Enerox, a vanadium redox flow battery manufacturer, providing grid-scale and microgrid energy storage solutions.

Garnet's claim form sought declarations against VRFB-H concerning an alleged breach of the joint venture agreement in relation to EHL.

The alleged breach was in respect of the indirect investment, announced on April 27, 2021, into EHL by Mustang Energy through VRFB-H, in terms of which Mustang acquired a 22.1% shareholding in VRFB-H in return for an investment of $7.5-million.

Meanwhile, Bushveld and Mustang have agreed on the extension of the notice period for Mustang to issue notice in respect of the backstop as announced on January 19, by a further 72 hours to close of business on March 10 to allow both parties to digest the judgment and its implications.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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