Mineral Commodities Ltd has confirmed an extension to the completion deadline for the sale of its Skaland Graphite Project, now set for no later than June 9, 2025, with financial penalties if delayed further.
- Sale of Skaland Graphite Project to Norge Mineraler nearing completion
- All contractual conditions satisfied as of March 17, 2025
- Completion deadline extended to June 9, 2025
- Interest rate penalty increases if payment delayed beyond deadline
- Parent company guarantee supports transaction obligations
Background on the Transaction
Mineral Commodities Ltd (ASX: MRC) has provided an important update regarding the sale of its wholly owned subsidiary’s asset, the Skaland Graphite Project in Norway. The transaction involves the sale of 100% of the shares in Skaland Graphite AS to Norge Mineraler Holding AS, a deal first announced in late 2024 and subsequently updated earlier this year.
All conditions precedent to the share purchase agreement were met by March 17, 2025, setting the stage for completion and payment originally due on March 21. However, the buyer, Norge Mineraler, has since requested an extension, with Mineral Commodities confirming that completion will now occur as soon as possible but no later than June 9, 2025.
Financial Terms and Safeguards
The extension comes with a financial safeguard for Mineral Commodities. Should Norge Mineraler fail to complete the transaction by the June 9 deadline, the interest rate on any outstanding payment will increase significantly, from 12.5% per annum to 20% per annum, calculated from the original payment due date of March 21 until completion.
This penalty interest rate underscores the importance Mineral Commodities places on timely completion and serves as a deterrent against further delays. Additionally, Norge Mineraler’s parent company has provided a guarantee to Mineral Commodities, ensuring that Norge Mineraler will fulfill all obligations under the sale agreement. This guarantee adds a layer of security for Mineral Commodities and its shareholders.
Strategic Implications for Mineral Commodities
The sale of the Skaland Graphite Project aligns with Mineral Commodities’ broader strategic goal of becoming a vertically integrated producer of graphitic anode materials and value-added mineral products. The divestment of this asset could free up capital and management focus to advance other parts of its portfolio, particularly in sustainable and governance-conscious mining operations.
While the extension introduces some uncertainty around the exact timing of cash inflows, the company’s transparent communication and contractual protections suggest a controlled and deliberate approach to closing this chapter.
Looking Ahead
Investors will be watching closely as the June 9 deadline approaches. The increased interest penalty and parent company guarantee provide some comfort, but the delay highlights the complexities often involved in cross-border mining asset transactions. Mineral Commodities’ ability to navigate this final stage will be critical in shaping its near-term financial position and strategic trajectory.
Bottom Line?
Completion by June 9 is crucial—delays could cost Mineral Commodities dearly and test investor patience.
Questions in the middle?
- Will Norge Mineraler meet the June 9 completion deadline?
- What impact will the delayed payment have on Mineral Commodities’ cash flow and capital allocation?
- How strong is the parent company guarantee in mitigating counterparty risk?