Mont Royal’s Merger with Commerce Faces Regulatory and Financing Hurdles Ahead

A Strategic Union in Critical Metals

Mont Royal Resources (ASX: MRZ) has taken a decisive step to reposition itself in the critical metals sector by announcing a merger with Commerce Resources Corp (TSXV: CCE). The deal, structured as a statutory plan of arrangement under British Columbia law, will see Mont Royal acquire all outstanding shares of Commerce, creating a dual-listed entity focused on critical minerals development in Quebec, Canada.

This merger is not merely a consolidation of assets but a strategic alignment of complementary projects that span rare earth elements (REE), fluorspar, niobium, lithium, copper, and gold. The combined portfolio leverages Commerce’s flagship Ashram Project, the largest monazite-dominant carbonatite-hosted REE deposit in North America, with Mont Royal’s Northern Lights lithium and base metals exploration assets.

The Ashram Project: A Rare Earth Giant

At the heart of this merger lies the Ashram Rare Earth and Fluorspar Deposit, boasting an Indicated Resource of 73.2 million tonnes at 1.89% rare earth oxide (REO) and 6.6% calcium fluoride (CaF2), alongside an Inferred Resource of 131.1 million tonnes at 1.91% REO and 4.0% CaF2. While these mineral resources have yet to be classified as reserves under the JORC Code, their scale and grade position Ashram as a world-class asset with significant potential to supply critical materials essential for clean energy technologies and advanced manufacturing.

Adjacent to Ashram, the Eldor Property’s Mallard and Miranna prospects offer promising niobium exploration opportunities, potentially adding a high-value dimension to the merged group’s portfolio. Niobium’s role in strengthening steel and emerging battery technologies could enhance the strategic importance of these assets.

Northern Lights and Broader Exploration Potential

Mont Royal’s Northern Lights Project, covering over 2,500 square kilometers in the Upper Eastmain Greenstone Belt, complements the merged entity’s focus with lithium, copper, and gold exploration potential. Situated in the Tier-1 mining jurisdiction of Quebec’s James Bay region, these assets provide a diversified pipeline of critical and precious metals exploration targets, enhancing the merged company’s growth prospects.

Financial Discipline and Market Positioning

Mont Royal maintained strict cost controls during the March 2025 quarter, ending with $1.26 million in cash. The company’s shares have been suspended from the ASX since mid-February pending re-compliance, with trading expected to resume in early August following merger completion targeted for late July. The dual listing on ASX and TSXV aims to broaden investor access, improve liquidity, and position the new entity among a stronger peer group of rare earth developers.

Executive Director Peter Ruse highlighted the merger as a value-creating opportunity, emphasizing the combined team’s expertise in advancing large-scale resource projects in Quebec. The integration of Mont Royal’s and Commerce’s management and technical teams is expected to accelerate development timelines and enhance operational capabilities.

Looking Ahead

While the merger marks a significant milestone, several key steps remain, including regulatory approvals, shareholder consent, and the completion of Commerce’s convertible notes financing subject to TSXV approval. Investors will be watching closely as the merged group advances its critical metals projects amid growing global demand for supply chain security in strategic minerals.