Member Info for M.McNulty

Note the @DFCgov and @USEmbassyLLW tags…!

All other tags are of people / orgs that are officially linked to / partnered with Mkango.

It therefore stands to reason that the first two @ tags are also linked to Mkango - not yet officially announced, but possibly (very) soon?

Gallmat,

We've gone over this multiple times.

1) Capital. This gets unlocked for MKA (at PLC level) once the valuation of the SPAC deal has been announced. The company will be able to raise cash via an equity placing at a substantially higher price than 13p (as I think the NAV/s of the SPAC listing - the non-core business! - will be 40p+); or via selling down its shareholding in the SPAC company; or via borrowing against the holding.

2) A NASDAQ listing for Maginito at this current moment in time would be detrimental to existing MKA shareholders. Consider this: global consumption of NdFeB magnets is circa 250k tpa. The US accounts for circa 35 ktpa, less than 15% of global consumption.

Yet under current (officially RNS'd) plans for the HyP group comanies, HyP USA at up to 4,671 tpa (being the enlarged Texas plant's 1,557 tpa annual production, times three) now constitutes 88% of planned group production of 5,331 tpa (also accounting for 330 tpa in each of the UK and Germany).

As consideration for its 50% JV holding in HyP USA, CTH would thus demand a substantial share increase in Maginito., which would materially dilute MKA's holding well below its current 80%.

However, if Maginito announced dramatic expansion plans in the EU (where Mkango is an effective 72% holder - 80% of Maginito, which holds 90% of HyP Germany) - say to 2,000 to 3,000 tpa - then CTH would ultimately be granted a smaller slice of the Maginito pie, when it comes to rolling up HyP USA into it. Not of course because HyP USA would have decreased in value, but because the value of the ex-USA pie would have increased substantially.

The EU is currently a larger consumer of NdFeB magnets than the USA. So in fact, now that Maginito / Mkango has the blue prints (in the DFS) to the HyP USA operation, modular rollout across other nations and territories should be straightforward. [In the EU, btw, I wouldn't be surprised to see a tie up between HyP Germany and Caremag, or possibly a new, separate HyP entity (HyP France?) JVing with Caremag.]

Now consider HyP announcing plans to open one, two or three >1 ktpa plants in Japan - another major NdFeB market. Again, MKA shareholders would be starting from an 80% equity ownership base, before potential dilution by brining in a local partner (Envipro).

Then think of rollouts in India, Mexico, Canada...

It would be madness to dilute our 80% ownership in the global business which has a TAM 7-8x the size of HyP USA - simply to see a immediate uplift in the SP.

By the time HyP's patent family expires, the NdFeB magnet industry, worldwide, is forecast to be close to $40bn pa. The HyP companies will likely be the lowest cost manufacturers in the world - including those in China. That means that the owners of the tech will be able to dominate said market.

I'd recommend stop thinking about short-term wins, and try to see the big picture. For me, this is a potential 100 bagger.

Esduk, we seem to have crossed posts!

Well laid out, and fully agreed.

Sticksandstocks,

Firstly, it's a matter of bandwidth. Focus right now is on completing the first NASDAQ listing, which transforms Mkango into a green tech / infrastructure play.

Secondly, it's a matter of how and what elements of HyProMag are listed, and the equity breakdown.

Is just HyP USA to be listed? Or Maginito? Or Mkango itself? What will CoTec's % ownership of Maginito or Mkango be, once the HyP JV is rolled up into either of them, pre-listing? It would be less, were Maginito to launch projects in Japan, Mexico, Canada, India, beforehand - as those initiatives would lessen the dominance of HyP USA (which is 60% owned by CoTec) on the overall valuation of Maginito.

So explicitly for existing Mkango shareholders (of which mgmt are big players!), there is sense in building out the non-US HyP businesses as fast as possible, before a NASDAQ listing.

As for interviews... In my experience, they usually do more harm than good to a company's share price. So I'm more than happy not to see them!

It will be two separate NASDAQ listed companies.

USAR is being valued on its proposed magnet business only (they arrived at the valuation range based on an EBITDA multiple from magnet sales in 2027. No value attributed to USAR's REE deposit,).

USAR acts a direct peer (and valuation gauge) to the envisaged NASDAQ IPO of HyProMag.

For the best US-listed Songwe-Pulawy comparison, look at Rare Element Resources (REEMF), which is upstream only (deposit, and a proposed separation plant). Current mkt cap of circa $360m.

For me, I would like to see Mkango itself rebrand to HYP, once the Songwe-Pulawy spinout is complete; rollup HyP US into us (with CoTec becoming a major shareholder), then floating ourselves on NASDAQ... Or else floating Maginito on NASDAQ (but again, once HyP US has been rolled up into it).

Essentially, whichever vehicle is listed on NASDAQ should own 100% of all HyP companies (ideally, with the current Mkango shareholders owning over 50%!).

USARE is currently at $1.5bn mkt cap (being 850m shares in issue times Friday's closing share price of $18).

Stillwater's AISC is $106/kg in the year that its output is forecast to be 1,200 tonnes.

HyP USA's AISC is $19.6/kg in the year that it's output is scheduled to be 1,041 tonnes.

So actually, they are very close and useful peers.

(As we know, HyP USA's annual output is now being increased to around 1,500 tonnes, so it's likely that the $19.6/kg will come down even further).

USARE's proposed operation will be hugely underwater at current pricing. HyProMag's will be hugely profitable.

Yet the US investment community was still willing to invest $50m+ in new cash into USARE, at a $800m+ valuation.

With that in mind, it should be easy to perceive how HyP will be gunning for a billion $ valuation listing. Perhaps later this year? Certainly by end of next year.

The exact number of shares in issue, will be relayed to the market in the next couple of sessions, I believe.

Go to the USARE website, go to FInancials, go to SEC Filings, and read the major document dated 13 Feb (it's the US version of a prospectus). Around pp.16-17, it gives a breakdown of likely shares in issue, post deal completion. It's around 85m shares. That's a listing value (at $10 share price) of $850m.

Worthwhile looking at the top level projections provided (p.126-127), and how the AISC is literally 5-6 times higher than that of HyP USA.

I have also just done a semi-detailed Tweet on the subject.

This is a hugely important read-across for Mkango. When the HyProMag companies are ready to list, this USARE deal would suggest that the group could be looking at a listing value of well over $1bn.

DYOR.

A brief update on Mkango and the wider REE industry:

mylesmcnultytrades.substack.com/p/mkango-resources-a1a

Gallmat,

You do realise that Mkango has one of the largest long loop recycling operations in the UK already, held through its subsidiary, Mkango UK?

The operation is based at Tyseley Energy Park, adjacent to the HyProMag UK operation. I visited the site several months ago.

The company stated the following in its 29 November quarterly update:

"Mkango UK recently commissioned a long-loop recycling pilot plant at Tyseley, which processes NdFeB magnet

scrap or swarf to produce rare earth carbonates and oxides via a chemical route.

This complements the short-loop recycling plant currently being commissioned by HyProMag and University of

Birmingham also at Tyseley, which processes NdFeB magnet scrap to produce rare earth alloys and magnets.

Both long-loop and short-loop recycling technologies are underpinned by the patented HPMS technology developed

at University of Birmingham, which liberates magnets from end-of-life scrap streams in a cost effective and energy

efficient way to produce a recycled NdFeB alloy powder, which is manufactured into a magnet (via the short loop

process) or into a rare earth carbonate or oxide (via the long loop chemical process).

Optimisation of long-loop pilot operations is underway, targeting near-term pilot scale production of the first 50kg

batch of rare earth carbonates and oxides, in parallel with completion of scoping studies and evaluation of options to

advance long loop recycling via stand-alone development, joint venture or other commercial arrangements. The long

loop recycling route is used to process NdFeB HPMS powder not suitable for short-loop recycling or for the processing

of magnet swarf (i.e. the powder produced from grinding and finishing magnets). "

......

The reason it's not discussed much, as it really is nothing compared to the HyProMag operation. Although Mkango UK will be commercial in itself (albeit on a smallish scale), a major reason for its development is for the MKA team to understand the (many) advantages of HyProMag over all other (chemical-based) REE recyclers across the world. Understanding how the competition works, and how HyProMag's unique technology crushes it.

We don't need to partner with Ionic (or any other chemical-based REE recycler), as we can do everything in-house: both hydrogen-based recycling that absolutely no one else can do; and chemical-based recycling, that anyone can really do, as there isn't much IP in that space.

A summary of my Trade Thesis for UK-based direct-to-consumer e-commerce business, Huddled Group.

An illiquid nano-cap, so caveat emptor - but it's a company growing ridiculously quickly, and (I think) one with serious rerate potential.

http://mylesmcnultytrades.substack.com/p/huddled-group

Nothing.

Have you read the the summary of the thesis?

If you had, you would know that HPMS recycling generates feedstock for making NdFeB magnets (essentially, what all this heated global geopolitics is about) at a cost that is almost 90% cheaper than feedstock this is sourced from primary mining.

But even if you do want to talk about how a US-Ukraine REE deal might impact on Mkango with regards to Mkango's upstream assets - well, you should know that Ukraine doesn't actually have any NdPr deposits that are advanced stage, like Songwe Hill. Certainly not any that are fully permitted and construction-ready.

In fact, the Ukraine-US-rare earths headlines is a bit of a misnomer. The rare earths that Trump and the MSM refer to are not explicitly REEs only, but rare earth minerals in general such as lithium, uranium, titanium, with some REEs thrown in.

My first article on Substack - an extended summary of the investment thesis for Mkango:

mylesmcnultytrades.substack.com/p/mkango-resources

At 11.25p, MKA only has a £36.7m mkt cap.

Meanwhile, the two other main rare earths players listed on the LSE, RBW and PRE, have mkt caps of £78m and £73m respectively.

Owing to both Songwe Hill and Pulawy being spun out onto NASDAQ - which should command a substantially

higher valuation, owing to a richer, much deeper and frankly more optimistic(!) pool of investors than the current UK community - and owing to the HyProMag majority holding, I am convinced that MKA’s mkt cap should be double that of RBW and PRE, and not the other way around as it is now.

Apologies. The TVR has not doubled, but actually only increased by 52% in the period from November 2021 to today, from 214.6m to 326.3m.

So the share price today looks even more absurdly undervalued, given all the progress in the period.

Since that high of 38.5p in November 2021, the total voting rights in Mkango has approximately doubled.

However, there have been immense developments within the company, since then:

Firstly, Songwe Hill. The company completed a definitive feasibility study on the project in July 2022. Then in July 2024, Mkango signed a Mine Development Agreement with the Malawi government. This made Songwe Hill one of only 3-4 construction-ready, full permitted rare earths mines worldwide. A huge huge deal.

Secondly, HyProMag. In November 2021, Mkango owned only 42% of HyProMag. The tech was commercially unproven, and the UK and Germany plants were little more than conceptual (indeed, on the day of the intra-day all-time high of 38.5p, it was actually the first ever announcement of the Germany plant that catalyzed the SP to that ATH!).

Today, Mkango is 80% owner and operator of HyProMag. The UK and Germany plants are fully funded (well, the Germany plant may require a final £1m-£1.5m of capex) into production, which once scaled up could each produce as much as 330 tonnes of NdPr product per annum - say EBITDA of $15m on revenues of $30m per annum, EACH.

Moreover, Mkango now also has a joint venture with CoTec - namely HyProMag USA - to roll out plants in the US, which did not exist in Novmber 2021. That much larger operation should go live in early 2027, and should have an initial run-rate of $66m EBITDA on revenue of $99m, per annum. Mkango owns an effective 40% interest in that US JV. Whilst the capex to finance the build out of the multi-location project in the US (circa $125m) has not been sourced, Mkango is not required to source any of it - the terms of the JV mean that that responsibility falls solely on CoTec's shoulders. Mkango's 40% stake is non-dilutable, regardless of how that $125m is structured.

Finally, it's also key to note that since November 2021, it's become clear that the HyProMag technology is market-leading in numerous ways - cost of production, as well as the very broad array of scrap material it can digest. It is in a position to monopolise the REE recycling industry before its patents expire in 2037.

The tech is globally scalable - Mkango has openly stated that it is developing plans to roll out HyProMag plants in fourth and fifth jurisdictions, namely Japan and Canada. And there have also been hints that Mexico and India under consideration, as locations for plant rollout.

NdPr prices have come off quite a bit since November 2021, but geopolitics have never been more important, re: global REE supply and demand. New use cases are likely to prove transformational to NdPr demand over the coming decade (that were not so apparent in November 2021, as they are now) - notably, aerospace, data centres and humanoid robots.

Hope that helps!

I like to think I know both AVCT and N4P very well. I've been a large holder of the former for over 5 years now, and was previously a TR1 holder of N4P (positioned before the time it rose from 2-4p, to as high as 35p).

Whilst I was one of the shareholders who demanded AS' removal from AVCT last year, that hardly means that I think poorly of the man. He knows the AIM community very well, and - apart from the horrendous pricing of the fundraise last year (which was the fault of a greedy fund manager coupled with the greed of a particular broking house) - has an excellent track record for fundraising.

Clearly, Avacta outgrew him, but in my view his skillset is ideal for where N4P is right now.

Deals-wise - let us not forget that he signed a collaboration and licensing agreement with Moderna, for Moderna to use Avacta's Affimers in its mRNA therapeutics.

Moderna - the world leader in mRNA - could / would be the ultimate partner for / customer of N4P. AS could be key to introducing the two companies.

This is hugely positive news for N4P.

Contrary to what this troll, Winston263, is yapping on about, I have been adding to my position today (that 29m buy was one of mine).

Volume and SP movement the past couple of sessions and this AM suggests a leak - and the obvious leak is that a farm-out has been successfully concluded.

Speculative trade that it gets announced over the next week.

Moreover, I am 99% confident that Mkango will never operate a mine (at least not Songwe Hill).

Songwe Hill and Pulawy - packaged together under Lancaster Exploration - will be spun out onto NASDAQ, with new funds being raised at the time of the transaction (either through cash already being in the SPAC, or else via a more conventional IP cum fundraise), and Mkango becoming a passive but majority (circa 60-80%) shareholder.

Mkango will then be left as the world-leading REE recycling business, eventually with plants in half a dozen or more nations spanning three - possibly four, even five - continents. [And with its equity stake in the NASDAQ-listed upstream businesses being a liquid $100m+ holding that could be gradually sold down to fund the HyP rollout.]

Who doesn't love an anonymous angry troll on a share bulletin board!

Bless your angry little socks, roger66.

Will also pointed out that interest in Songwe Hill was really picking up again. The MDA has obviously been the key to reigniting interest; but the very strong rally in NdPr over the past 6 weeks has also been a major positive.

There are “upstream-only” REE companies (mining and/or separation) valued at multiples of Mkango – that are at the same, or an even earlier, stage. See for example Pensana, Rainbow on the LSE; see Arafura, Lindian and many others on the ASX. [Lindian in particular has a Malawi-based deposit that, whilst larger than Songwe Hill, does not yet have an MDA. In fact, I don’t think it’s anywhere near having an MDA signed off. Lindian’s mkt cap is almost 300% greater than Mkango’s.]

In the US, Noveon Magnetics (previously named Urban Mining Company) is a direct peer to Maginito. It was forecast to generate revenues of circa $10m in 2023. It raised $75m in a Series B round last year, giving the company an approximate valuation of $300m. Noveon has also received over $35m in funding from the US Department of Defence.

By the end of next year, revenues from HyProMag UK alone could be on annual run rate of closer to $20m. That’s not accounting for revenues that would have commenced in Germany, and much larger revenues that would be commencing the following year (2026) in the US. That $300m valuation should be an 18-month target for Maginito.

I am so relaxed (rather, excited!) about this investment. Through its industry-leading recycling technology as well as its shovel-ready INDEPENDENT REE deposit, Mkango is unbelievably well positioned to thrive in the geopolitical mess in the years ahead (I’m assuming Trump wins in November).

Good luck to all (genuine) holders!