The proposed transaction, which values the combined entity at an estimated enterprise value of $313.5m, is expected to be closed in the first quarter of 2023
US-based rare earth metals miner NioCorp Developments has signed a definitive agreement to merge with GX Acquisition Corp. II (GXII), a special purpose acquisition company (SPAC).
Under the terms of the merger agreement, NioCorp will acquire GXII to become a publicly traded company and be listed on the Nasdaq Stock Exchange.
NioCorp shares will continue to be traded on the Toronto Stock Exchange (TSX).
The proposed transaction, which values the combined entity at an estimated enterprise value of $313.5m, is expected to be closed in the first quarter of 2023.
Upon closing, the combined company is expected to have $285m in cash from the GXII trust account, which will be used to advance the Elk Creek critical minerals project.
NioCorp CEO and executive chairman Mark A Smith said: “This business combination with GXII, and the two additional financing packages, has the potential to significantly accelerate our efforts to obtain the required project financing and to ultimately bring the Elk Creek Project to construction and eventual commercial operation.
“Our goal is to rapidly build secure and reliable US supply chains of the critical minerals that multiple industries need to help us build a more sustainable and less carbon-intensive future and for other critical domestic uses.
“Once completed, these transactions have the potential to put NioCorp on the fast track to obtain the required project financing to deliver on that promise, and to do so in an environmentally smart manner.”
In addition to SPAC merger, NioCorp has signed non-binding letters of intent (LOIs) for two separate financing packages with Yorkville Advisors Global.
The financing packages are expected to provide the company with an additional $81m to advance the Elk Creek Project, subject to the signing of definitive agreements.
NioCorp intends to start construction at its Elk Creek Project, a pure-play critical minerals project with the highest-grade Niobium resource in North America.
The company is currently conducting technical and economic analyses of the potential addition to the planned product suite of several magnetic rare earth oxides
GXII co-chairman and CEO Dean C Kehler said: “NioCorp’s Elk Creek project is the highest-grade niobium deposit under development in North America, and the second largest indicated rare earth resource in the US.
“Critical minerals such as niobium and scandium, and magnetic rare earth elements, can accelerate the world’s transition to a lower carbon economy.
“We believe NioCorp is well-positioned to be a reliable, US-based supplier that will produce these products on a sustainable basis.”