SMM11, March 13: recently, Luoyang Molybdenum Industry announced that Luoyang Luanchuan Molybdenum Group Co., Ltd. intends to acquire a 100% stake in Huayue Nickel Cobalt (Indonesia) Co., Ltd., an existing shareholder of Huayue Nickel Cobalt (Indonesia) Co., Ltd., through CMOC LIMITED, a wholly owned subsidiary of Hong Kong. At the same time, Woyuan Holdings acquired 10 per cent of Huayue Nickel and Cobalt shares held by existing shareholder Indonesia Morowali Industrial Park (hereinafter referred to as "IMIP"); after the acquisition, the company will eventually indirectly hold a 21 per cent stake in Huayue Nickel Cobalt. Upon completion of the above equity transfer, the Company intends to increase the capital of Huayue Nickel and Cobalt through Woyuan Holdings in a currency not exceeding US $69.1 million or its equivalent, thereby increasing the Company's ultimate stake in Huayue Nickel and Cobalt from 21 per cent to 30 per cent upon the completion of such capital increases. Based on the total investment approved by Huayue Nickel Cobalt and the progress of the project, the Company will provide financing guarantee and shareholder borrowing for Huayue Nickel Cobalt in accordance with the agreed proportion.
According to the announcement, Luoyang Molybdenum Industry said that in order to fully enjoy the dividends of the development of the new energy industry in the future and actively layout the industry chain of rare resources in the field of new energy, the company plans to layout the nickel and cobalt industries in Indonesia through this investment to participate in the construction of the laterite nickel mine wet smelting project in the Morowali Industrial Park in Indonesia for the production of mixed nickel cobalt hydroxide (MHP) with an annual output of 60,000 tons of nickel metal.
Investment in Huayue nickel and cobalt will help the company build a scarce resource industry chain in the field of new energy, enable Luoyang molybdenum industry to fully enjoy the opportunities and benefits of the new energy industry in the future, further accelerate the in-depth development of the company's mining industry, and enhance the competitiveness of the company.
It is worth noting that Huayue Nickel Cobalt was registered in Morowali, Central Sulawesi Province, Indonesia, and is mainly engaged in the construction and operation of the project. The future price trend of non-ferrous metals such as nickel and cobalt, the main products of Huayue nickel and cobalt, has great uncertainty. If the prices of nickel and cobalt fall sharply in the future, it will bring significant uncertainty to the profitability of this investment.
