Neometals Ltd (ASX: NMT) (Neometals or the Company) announces that, following a comprehensive review of its lithium-ion battery (LiB) recycling strategy, it has entered into a binding term sheet with its joint venture partner, SMS Group GmbH (SMS) to transfer to SMS its 50% interests in both:
• Primobius GmbH (Primobius), the incorporated plant-building joint venture with SMS; and
• ACN 630 589 507 Pty Ltd (ACN 630), the holding company for patented LiB Recycling Technology.
In accordance with the binding term sheet Neometals and SMS will use all reasonable endeavours to execute formal agreements by 31 August 2025 to give effect to the proposed transaction (Formal Agreements), whereby Neometals will divest its interests in Primobius and ACN 630 to SMS in consideration for the payment of €5 million (c. A$8.9 million1) cash plus an ongoing commercial compensation fee representing 2% of Primobius’ annual revenues determined for each fiscal year from 1 July 2025 to 30 June 2037 and capped at €7 million (and indexed to inflation) (c. A$12.5 million1).
Completion is subject to several standard conditions precedent, including:
• receipt by Neometals of any required regulatory approvals; and
• receipt by SMS of approval from its shareholder committee.
The transaction follows Neometals’ further assessment of the expected future quantum and timing of working capital requirements for the commercialisation of the Primobius plant building joint venture and the timing of returns from future royalties derived from plant sales. The review also considered forecast market conditions in the battery materials, European lithium-ion cell production and electric vehicle sectors.
The transaction will deliver early cash consideration to Neometals, while relieving Neometals of the requirement for future shareholder capital contributions during Primobius’ business development phase. This will enable Neometals to redeploy capital to other opportunities which are believed to be more net value accretive for Neometals’ shareholders. The strategy reflects the Company’s focus on:
• capital-efficient, lower-risk business models, while limiting Neometals’ exposure to more capital intensive projects;
• a disciplined approach to capital management; and
• value realisation from its portfolio.
The parties will work towards satisfying the conditions precedent to the transaction during Q3 2025. Neometals will keep the market informed on material developments as the transaction progresses.
Neometals Managing Director, Chris Reed, said:
“We are proud of the pioneering role we’ve played in conceiving and developing the hydrometallurgical battery recycling technology and the progress made through the Primobius JV. We thank SMS group for their strong partnership and shared belief and ongoing commitment to responsible battery recycling.
Whilst we are disappointed that Neometals is unable to commit to the ongoing working capital required for this business, we are pleased to be in a position to be able to redirect the proceeds from the sale into nearerterm, cash generative opportunities that align with our strategic priorities.”
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About Barrambie
The Barrambie Project hosts one of the world’s highest-grade titanium deposits and is also highly prospective for gold mineralisation. Minimal gold exploration has occurred since the 1990s within Neometals’ 505 square kilometre tenure, which contains approximately 40km strike of the Barrambie Greenstone Belt. The potential for high-tenor gold mineralisation is demonstrated by several historic mining sites within the Belt which have an average production grade of 24.8g/t, and, based on historic drill data, a gold Exploration Target has been estimated at between 8Mt at 1.3g/t Au and 10.5Mt at 2.3g/t Au, for 335k and 775k ounces.
Contact details:
For more information, please contact:
Managing Director/CEO
Neometals Ltd
T +61 8 9322 1182
Managing Director
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