BCI Minerals to sell Iron Valley for $72.6m

(Image source: Mineral Resources) The sale will allow BCI to focus on its Mardie salt and potash project.
(Image source: Mineral Resources) The sale will allow BCI to focus on its Mardie salt and potash project.

Iron Valley, a subsidiary of BCI Minerals (ASX: BCI), is selling its Iron Valley iron ore assets to Polaris Metals, a subsidiary of Mineral Resources (ASX: MIN), for up to $72.6m.

Iron Valley will receive $26m on completion of the transaction, which is expected in July 2024, and a further $12.5m contingent on commencements of mining at the Iron Valley north pit.

The existing iron ore sale and purchase agreement between BCI and Mineral Resources will terminate upon completion of the transaction, with BCI to receive a final deferred payment of $34.1m in July 2025.

Polaris will assume responsibility for payment of state and third-party royalties and rehabilitation obligations, effective from May 1, 2024.

BCI managing director David Boshoff commented on the sale.

“BCI appreciates the successful partnership it as had with MinRes and welcomes the opportunity to sell the Iron Valley assets,” he said.

“The proposed sale is a strategic decision that enables BCI to realise $60.1m certain value for these assets, plus a further contingent $12.5m, and a continue to focus on safely delivering the Mardie project on schedule and on budget, providing value to our shareholders and multi-generational benefits to the community.”

Subject to the receipt of Ministerial consent regarding the transfer, the transaction is expected to be completed in early July 2024.

Either company can terminate the agreement if any conditions aren’t satisfied by early September 2024.

The sale allows BCI Minerals to focus on its Mardie salt and potash project in WA.