The board of takeover target Technology Metals Australia has reaffirmed its support of Australian Vanadium’s $217 million merger despite a block of shareholders being against the proposal.
In an announcement to the ASX this morning, Tech Metals said its board of directors unanimously recommended that its shareholders vote in favour of the scheme of arrangement, in the absence of a superior proposal.
But the critical minerals explorer also revealed that about 9.29 per cent of its shareholders had indicated their intention to vote against the scheme, according to today's ASX statement.
That comes after Tech Metals announced in September that 26 per cent of its shareholders – including Resource Capital Funds, which holds an 18 per cent stake – had backed merging the neighbouring firms into one entity under the AVL brand.
Under the merger deal, Australian Vanadium would acquire all of the ordinary shares issued in the capital of Tech Metals in a move worth $217 million.
Perth-based Tech Metals’ Murchison project boasts a 153.7-million-tonne resource and 44.5mt mineral reserve at 0.89 per cent vanadium oxide.
AVLs’ adjacent namesake project has a 239mt resource and 30.9mt ore reserve going at 1.09 per cent vanadium oxide.
In September, Tech Metals managing director Ian Prentice said the merger would help to progress the Gabanintha vanadium orebody, which he described as one of the best undeveloped vanadium resources in the world.
If approved, TMT shareholders would hold about 42 per cent of the company.
Mr Prentice would join AVL management. Mark McGowan’s former deputy chief of staff and TMT non-executive director Jo Gaines would continue her role for AVL.