TORONTO (miningweekly.com) – Quebec-based exploration and project development firm Mason Graphite on Monday said it would spend $700 000 to buy 40% of the issued and outstanding shares of privately held research and development company Group NanoXplore, which would give Mason the capability to upgrade its flake graphite product to sought-after graphene.
TSX-listed Mason said it had signed a letter of agreement with NanoXplore through which the management teams of Forbes & Manhattan and Mason Graphite participated in a private placement for 875 000 common shares of Mason at a price of $0.80 apiece. The issue price represented a 12.7% premium to Friday's closing price of $0.71.
Graphene is a form of carbon consisting of planar sheets that are one atom thick, with the atoms arranged in a honeycomb-shaped lattice.
"We are thrilled with the synergies between Mason Graphite and NanoXplore. This mutually beneficial alliance will connect our expert teams and combine potential low-cost flake graphite production from our Lac Guéret project and potential low-cost graphene production from NanoXplore's process,” Mason president and CEO Benoît Gascon said.
He added that through the strategic alliance, Mason would eventually become NanoXplore's exclusive supplier of natural flake graphite and it would actively be involved in all facets of their sales and marketing activities.
Gascon noted that customers seeking flake graphite were potential customers of graphene. “As such, we strongly believe that the relationships we have developed with global graphite customers in the last two decades will greatly benefit NanoXplore's market penetration and distribution abilities,” he said.
The proposed transaction would be completed in two tranches, with Mason purchasing a 20% interest in NanoXplore by the end of the month for $350 000. The company then has the right to buy an additional 20% interest in NanoXplore by July 31, for an additional $350 000 if Mason was satisfied with the business, operations and progress of NanoXplore over the six-month period following the first tranche.
Upon the closing of the first tranche, NanoXplore would appoint Mason as its sales, marketing and distribution agent and, upon closing of the second tranche, NanoXplore would appoint Mason as its supplier of graphite once production had started.
Further, after the first tranche had been completed, NanoXplore would appoint Gascon as the chairperson of its board, and Mason’s executive VP, CFO and corporate secretary, Luc Veilleux, as a director and its CFO.
Mason Graphite has announced a 658% increase in the compliant measured and indicated mineral resources at its flagship Lac Guéret graphite project in the north-east of the province.
Mason last month announced that recent drilling had resulted in it lifting the resources to 50-million tonnes, up from 7.6-million tonnes, and the inferred resources rose to 11.9-million tonnes from 2.8-million tonnes.
Overall, the measured and indicated grade is 15.6% graphitic carbon, which validated the main parameters of the April preliminary economic assessment report, the company said.
This comprised a 22-year life-of-mine at a grade of 27.4%, with a low stripping ratio of 0.76:1 and operating costs of $390/t.