Unlisted Perth company Global Advanced Metals (GAM) has announced a $US400 million acquisition that continues the revival of the two specialist minerals businesses that emerged from the ashes of failed miner Sons of Gwalia.
GAM, formerly Talison Tantalum, and Toronto-listed Talison Lithium, have been revived by private equity investor Resource Capital Funds (RCF), which is jointly run from Perth and Denver.
RCF bought the assets from the receivers of Sons of Gwalia, split them into two businesses, and nursed them through the global financial crisis, when they actually shut down some of their production.
GAM resumed production at its Wodgina and Greenbushes tantalum operations in January, while Talison Lithium is in the midst of a $70 million expansion that will double the capacity of its Greenbushes operation.
GAM plans to acquire US-based Cabot Corporation’s two tantalum manufacturing plants, which operate as Cabot Supermetals, in Boyertown, Pennsylvnia and Aizu, Japan.
The facilities convert tantalum concentrate and scrap for use in high-tech electronics, and also for use in the aerospace and chemicals industries.
Cabot Corporation’s tantalum mining operation in Canada was not included in the transaction.
GAM produces tantalum concentrate from its Wodgina mine, near Port Hedland, and its Greenbushes processing facility, near Bunbury.
At full capacity, GAM's Wodgina operation is capable of producing 1.4 million pounds of tantalum peroxide annually, which equates to about a third of the world's supply.
GAM chief executive Bryan Ellis said the acquisition of Cabot Supermetals would enable the company to meet its long-term goal of becoming a vertically integrated tantalum miner and manufacturer.
“The acquisition of the Boyertown and Aizu plants presents us with an opportunity to meet the rising demand from the electronics industry for higher performance tantalum powder and to develop high quality metallurgical products for aerospace and other applications,” Mr Ellis said.
Supermetals general manager Andrew O’Donovan said the two companies were an “excellent fit”.
“We are looking forward to joining the GAM team which has a strategic outlook for the tantalum value chain,” Mr O’Donovan said.
“We share a common approach to ethical “conflict-free” product sourcing, employee safety and strict environmental responsibility.
“The integration will allow us to continue to focus on delivering market-leading technologies, product quality and customer service.”
GAM said investment bank Gryphon Partners acted as its leading advisor for the transaction, with significant input from its largest shareholder, Resource Capital Funds.
Law firm Allen & Overy said it also advised GAM on the transaction. Perth partner Peter Wilkes, lead advisor for the transaction said: “this transaction was a great opportunity to demonstrate Allen & Overy's unique capabilities bringing together expert teams in our Perth, New York and Tokyo offices to advise on all aspects of the transaction".
