Critical Metal Regulatory News (CRTM)

Critical Metals plc / EPIC: CRTM / Market: Main Market / Sector: Closed End Investments

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

20 May 2021

Critical Metals plc ("Critical Metals" or the "Company")

Heads of Terms Signed

Proposed Acquisition of DRC Copper/Cobalt Project

Suspension of Listing

Critical Metals plc, a mining investment company established to acquire mining opportunities in the critical and strategic metals sector, is pleased to announce that it has signed a non-binding Heads of Terms with Madini Minerals, a Johannesburg based enterprise focussed on investment in advanced exploration or near term production assets in Africa ("Term Sheet") for the possible acquisition of a majority stake (57 %) in Madini Occidental Limited ("MO"), which will hold a 70% beneficial interest in a 'Small Scale Mining License' ("Permis d'Exploitation de Petit Mine") PEPM 14784, in the Democratic Republic of Congo ("Molulu" or the "Project') (the "Proposed Acquisition"). Molulu is a copper/cobalt project located on the Katangan Copperbelt, adjacent to a number of existing medium and large scale mining operations that are in production.

The Proposed Acquisition is to be made via an acquisition of shares in MO, a company incorporated in Mauritius, to the value of US$850,000, of which US$100,000 will be paid to the current owners of PEPM 14784 and the remaining US$750,000 to be spent on the development of the Project. In addition, 2 loans of US$150,000 and US$200,000 will be made available to MO on terms to be agreed, with the former to be advanced to the current owner of the Project on terms to be agreed. The latter is to be used to fund an exploration drilling program to enable a JORC compliant resource to be created.

Under the Term Sheet, the current owners will retain the other 30% interest in the Project. The remaining 43% interest in MO will be held (in equal amounts) by Madini Minerals and Mr Russell Fryer, the CEO of Critical Metals. In 2018, Mr Fryer had invested US$200,000 in MO and has an outstanding interest bearing loan to MO of US$800,000. As such, the directors of Critical Metals other than Mr Fryer have approved the Term Sheet.

The Proposed Acquisition is in line with the Company's investment strategy to make equity investments into operators or near-term production operators within the critical and strategic metals sector in the continent of Africa and would represent the first acquisition since listing on the Standard List of the London Stock Exchange in September 2020. Molulu has previously been mined by artisanal miners from 4 pits and Critical Metals believes that the Project has the potential to be developed to become a new long-term, large copper-cobalt producer. Madini Minerals has conducted extensive geophysics, geotechnical analysis, and historical drilling at site shows copper grades ranging between 15% and 40% for sulphides and copper oxide grades of between 2% and 15% based on metallurgical samples undertaken by a copper smelter in Lubumbashi and made available to Madini. As part of the due diligence process to be undertaken by the Company, a competent person's report will be prepared on the Project. Critical Metals believes that the historical mining on site will enable a low cost restarting of production within approximately 6 to 9 months. Furthermore, the proximity of the Project to certain smelters should provide a selling channel for any copper production, leading to near term cash flow. The Company has agreed an exclusivity period of two months with the option to extend for a further month and will now undertake extensive due diligence to enable the Proposed Transaction to be completed.

Suspension of Listing

The Proposed Acquisition, if completed, would constitute a reverse takeover under the Listing Rules. As the Company is currently unable to provide full disclosure under Listing Rule 5.6.15, it has requested, and been granted, a suspension of listing in its shares with immediate effect pending either the issue of an announcement providing further details on the Proposed Acquisition, the publication of a prospectus, or an announcement that the Proposed Acquisition is not proceeding. Any restoration of the listing is subject to the approval of the Financial Conduct Authority.

The Company has engaged certain advisers and will engage others to rapidly progress the requisite due diligence, which, if satisfactory, is expected to lead to a reverse takeover transaction, which will be subject to the approval of the Financial Conduct Authority .

On completion of the Proposed Acquisition, the Company's listing would be cancelled and, subject to approval by the Financial Conduct Authority, the enlarged Company's ordinary shares would then be admitted to the Standard List and to trading on the Main Market for listed securities of the London Stock Exchange.

There can be no certainty that the Proposed Acquisition will take place and it remains subject, inter alia, to final terms being agreed.

Further announcements and updates will be made in due course.

Russell Fryer, CEO of Critical Metals, commented:

"We are delighted to have agreed a term sheet on our first potential acquisition, the first of what we expect will be a series of transactions. In that time, we have reviewed numerous projects and believe the Proposed Acquisition meets our stated objective of identifying a low CAPEX and OPEX project with near term production.

"The Democratic Republic of Congo is an area which the Board is familiar with and believe successful completion of the targeted transaction should position Critical Metals well for subsequent transactions.

"The demands for copper, as a 'critical mineral', are ever increasing as is seen in the buoyant copper price of late. Predicted to continue, an increased environmental agenda globally and electrification are at the centre of this with the proliferation of electric vehicles, the increased use of renewable energy sources, energy efficiency and increased consumption of electronics. In addition, cobalt is highly sought-after by both the aerospace industry and the rechargeable power unit sector.

"I believe this is an opportune time to gain exposure to copper/cobalt and I look forward to updating shareholders in due course."

**ENDS**

For further information on the Company please visit www.criticalmetals.co.uk or contact:

About Critical Metals

Critical Metals was formed as an investment company and intends to make equity investments into operators or near-term production operators within the natural resources development and production sector in the continent of Africa. It is envisaged that such acquisition or acquisitions will trigger a reverse takeover in accordance with the listing rules. The Company intends to search initially for acquisition opportunities in the natural resources sector on known deposits and more specifically minerals that are perceived to have strategic importance to future economic growth. Commodities such as antimony, beryllium, cobalt, copper, fluorspar, gold, rare earth elements, tin, tungsten, titanium, and vanadium have been identified by several governments as "critical minerals" and so guaranteeing supplies is seen as a strategic necessity. The Company therefore believes that the market conditions for these minerals will remain strong in the short-to-long term.