Bushveld Minerals Regulatory News (BMN)

Market Abuse Regulation ("MAR") Disclosure

Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement.

27 April 2021

Bushveld Minerals Limited

("Bushveld Minerals" "Bushveld" or the "Company")

Update on Enerox GmbH Investment

Bushveld Minerals Limited (AIM: BMN), the AIM-quoted, integrated primary vanadium producer and energy storage solutions provider, with ownership of high-grade assets in South Africa ("Bushveld Minerals"), is pleased to announce an investment by Mustang Energy Plc ("Mustang"; "LON: MUST"), into VRFB Holdings Limited ("VRFB-H") to acquire an indirect interest of 11.05 per cent in Enerox GmbH ("Enerox"). Enerox is a Vanadium Redox Flow Battery ("VRFB") manufacturer providing grid scale and micro-grid energy storage solutions. The Company also announces the completion of the investment by VRFB-H into the 100 per cent holding company for Enerox, Enerox Holdings Limited ("EHL").

Highlights:

§ As previously announced on 1 April 2021, a consortium of investors in Enerox are investing US$30 million to scale up VRFB production capacity to 30MW by 2022.

§ Bushveld Energy holds an indirect interest of 25.25 per cent in Enerox through a 50.5 per cent holding in VRFB-H, which in turn holds 50 per cent of EHL an entity that wholly owns Enerox.

§ LSE-listed Mustang, a Special Purpose Acquisition Company which intends to acquire interests in energy storage and stationary battery assets, has entered into a legally binding investment agreement with Bushveld Minerals, VRFB-H and its shareholders.

§ Mustang has invested approximately US$7.5 million to subscribe for a 22.10 per cent interest in VRFB-H, to be deployed into Enerox, and has become a new shareholder in VRFB-H. Mustang has funded its investment by way of an issue of US$8 million unsecured convertible loan notes at a 10 per cent coupon to certain investors ("Mustang Capital Raise").

§ On 31 March 2021 Bushveld Energy invested US$5.0 million into VRFB-H and has invested approximately another US$2.7 million to retain its 50.5 percentage holding of VRFB-H.

§ In turn, VRFB-H has invested US$15 million into EHL to fund its part of the US$30 million investment into Enerox.

The investment of VRFB-H into Enerox is in line with Bushveld Minerals' strategy to mobilise capital to scale up growth and capacity of VRFB manufacturers, either through self-funding mechanisms or through funding sharing arrangements such as this agreement with Mustang. This strategy has been recently and successfully illustrated by Bushveld Minerals' investment and subsequent realisation of an interest in AIM-quoted Invinity Energy Systems.

The Mustang Capital Raise, and the concurrent acquisition by Mustang of shares in the capital of VRFB-H, constitutes a reverse takeover under the Financial Conduct Authority's Listing Rules and will require the publication of a prospectus and readmission of Mustang to trading by no later than 31 December 2021.

In circumstances where the Mustang readmission does not take place by 31 December 2021, Bushveld Minerals has agreed to issue new ordinary shares in its capital to Mustang's noteholders (the "Backstop") in return for:

§ Mustang transferring to Bushveld Energy all of Mustang's shares in VRFB-H.

§ Mustang paying a fee to Bushveld Minerals of an amount equal to 5 per cent of the Mustang Capital Raise (including both principal and interest), to be satisfied by the issue of new ordinary shares in the capital of Mustang at a price of 20 pence per share (the "Backstop Fee"). The Backstop Fee is payable in the event of readmission not occurring by the aforesaid date or immediately prior to completion of readmission.

Certain of Mustang's noteholders have the discretion to elect not to receive new Bushveld Minerals shares and instead receive shares directly in the capital of VRFB-H.

Fortune Mojapelo, CEO of Bushveld Minerals, commented:

"We are pleased to complete the investment into Enerox by VRFB-H of the US$15 million announced on 1 April 2021 as part of a US$30 million financing to scale up Enerox's manufacturing capacity. As previously mentioned, we believe that this additional capital will place Enerox on the path to becoming a major player in the stationary energy storage industry, while further cementing VRFB technology in this rapidly growing sector. We are also pleased to welcome Mustang as a shareholder in VRFB-H. Its listing on the London Stock Exchange and consequent access to public equity capital markets combined with its strategy to invest in the stationary energy storage value chain and renewable energy projects, make them an especially attractive partner for VRFB-H."

ENDS

Enquiries: info@bushveldminerals.com

ABOUT BUSHVELD MINERALS LIMITED

Bushveld Minerals is a low-cost, vertically integrated primary vanadium producer. It is one of only three operating primary vanadium producers, owning 2 of the world's 4 operating primary vanadium processing facilities. The Company produced more than 3,600 metric tonnes of Vanadium  in 2020. The Company is funded to grow its production to more than 6,800 mtVp.a. by 2025 (almost double the achieved production in 2020), and could, subject to funding, increase its production to more to 8,400 mtVp.a. over the same period.

Bushveld Minerals owns a diversified vanadium product portfolio serving the needs of the steel, energy and chemical sectors. Bushveld Minerals participates in the entire vanadium value chain through its two main pillars: Bushveld Vanadium, which mines and processes vanadium; and Bushveld Energy, an energy storage solutions provider. Bushveld Energy is focused on developing and promoting the role of vanadium in the growing global energy storage market through application in vanadium redox flow batteries. 

Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com.

About Bushveld Energy Limited

Bushveld Energy is a leading energy storage solutions provider, focusing on the African market. Bushveld Energy recognises that the requirement for electricity in Africa touches on both the paramount potential for social transformation and an immense commercial opportunity.

Bushveld Energy is focused on developing and promoting the role of vanadium in the growing global energy storage market through application in vanadium redox flow batteries ("VRFB"). Its near-term strategy is to deploy several VRFB systems as part of its longer term vision to become a significant electricity storage provider in Africa, meeting the demand for utility scale energy storage in Africa by leveraging South Africa-mined and beneficiated vanadium. Bushveld Energy's business model embraces a number of activities along the VRFB value chain, including electrolyte manufacturing, investment in VRFB manufacturing, battery deployment and project development. 

http://www.bushveldenergy.com 

About Mustang Energy

Mustang Energy PLC is a Special Purpose Acquisition Company (SPAC), whose shares are listed on the Standard List of the Main Market of the London Stock Exchange, which intends to utilise its strong management experience and strategic relationship with Acacia Resources Limited, the Company's largest shareholder, to acquire interests in energy storage and stationary battery assets.

http://www.mustangplc.com/