CMC ACQUIRES QUARRY IN NORTHERN CHINA

CMC ACQUIRES QUARRY IN NORTHERN CHINA

CHINA Magnesium Corporation (ASX: CMC) will acquire a dolomite quarry in northern China for $730,000 to progress the vertical integration of its supply chain from dolomite supply through to magnesium and magnesium alloy production.

The Quarry is located at the foot of Tianzhong Mountain and approximately 30km from CMC’s magnesium ingot production plant located at Pingyao, Shanxi Province.

To exercise the option, CMC must pay RMB5,000,000, (AUD$730,000) less the option fee of RMB300,000 (AUD$44,000) which was paid at the time of entering the option agreement in 2008.

The purchase is planned to be funded from a mix of existing funds and from a Chinese bank debt facility which is currently being negotiated.

In order to complete the acquisition, conditions include the renewal, extension and assignment of the mining permit for the quarry and the assignment of the Land Use Agreement by the relevant local authorities - expected by the end of October 2011.

Managing Director of CMC Tom Blackhurst (pictured) says the company will continue to lock down opportunities that make good economic sense.

“CMC is confident of its existing supply chain for magnesium production but will continue to take opportunities to vertically integrate within the industry when the acquisitions make good economic sense,” he says.

“Dolomite is not a rare or complex raw material but it is fundamental for the production of magnesium, and control over supply requirements is another positive for the company as we progress our expansion plans.”

CMC shares last traded at 33 cents.

Get our daily business news

Sign up to our free email news updates.

 
Whitefox Recruitment founder Luke Hemmings making strides as a careers leader
Partner Content
After relocating his Canberra-founded company Whitefox Recruitment to the Gold Coast la...
Whitefox Recruitment
Advertisement

Related Stories

ASIC secures its first court win for greenwashing against US giant Vanguard

ASIC secures its first court win for greenwashing against US giant Vanguard

The Australian corporate watchdog has caught out one of the world&r...

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Australian-founded medicinal cannabis company Althea Group (ASX: AG...

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Listed funds manager 360 Capital Group (ASX: TGP) has offloaded its...

The party’s over: Splendour in the Grass festival cancelled for 2024

The party’s over: Splendour in the Grass festival cancelled for 2024

Splendour in the Grass, Australia’s largest winter music fest...