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Magnets producer attracts Wyloo investment

Monday, August 29th, 2022

Hastings’ Yangibana project in WA.

Wyloo Metals has announced a $150 million cornerstone investment in Australian rare earths developer Hastings Technology.

Hastings aims to become the world’s next producer of neodymium and praseodymium concentrate used in the production of permanent magnets.

Wyloo’s investment is in the form of secured, exchangeable notes, the proceeds of which will be used by Hastings to acquire a 22.1 per cent equity interest in TSX-listed Neo Performance Materials, a leading global rare earth processing and advanced permanent magnets producer and affiliate of Oaktree Capital Management.

The notes will have a term of three years and will be exchangeable, at any time after 60 days, into Hastings ordinary shares at an exchange price of $5.50 per share. They will earn an annual coupon equivalent to the three-month bank bill swap rate plus 9 per cent, payable in kind via the issue of additional notes.

Wyloo will also have the right to appoint a nominee director to the board of Hastings and retain that nominee while Wyloo’s equity interest in Hastings is 12.5 per cent or more.

Wyloo Metals chief executive officer Luca Giacovazzi said the investment fit well with the company’s long-term strategy to invest in the critical minerals that support renewable energy generation and electrification.

“Rare earths and the permanent magnets they produce are essential enablers of the energy transition. There is already a shortage of these products, and the upcoming increase in magnet demand will require continued investment,” he said.

“This transaction with Hastings spans the value chain, from mining to magnet manufacturing. As the owner of the only commercial rare earth metals facility in Europe, Neo is strategically placed to help Europe meet its goal to become climateneutral by 2050.

“We’re pleased to be investing in the stable and secure supply of minerals and permanent magnets that are inputs in essential products like electric vehicles and wind turbines.

“Wyloo is delighted to be partnering with Hastings as a cornerstone investor and we look forward to joining the Board and working alongside the company as it delivers upon its strategy.”

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