Hainan Mining from China Buys Stake in Two Mining Companies, Targeting Mozambique

Highlights

• Hainan Mining plans to acquire:
  • 68.04% stake in ATZ Mining
  • 51.52% stake in Felston
• Acquisition through shares and cash payments
• Target companies operate in Mozambique with mining licenses
• Licenses cover resources including titanium, zircon, monazite, and rutile
• Licenses span over 15 years
• The acquisition signals strategic expansion in the metal minerals sector
• Financing from up to 35 specified investors

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Hainan Mining Co., Ltd. (opens in a new tab)  (601969.SH), a publicly traded Chinese mining company, has announced plans to acquire controlling stakes in two mining companies, ATZ Mining and Felston, to expand its operations in heavy mineral sand concentrate mining. The company intends to acquire a 68.04% stake in ATZ Mining and a 51.52% stake in Felston through a combination of issuing shares to Hainan Yuneng and cash payments via a newly established subsidiary.

The acquisition will be financed by issuing shares to raise funds from up to 35 specified investors.

Both target companies operate in Mozambique and specialize in mining zircon-titanium ore, producing valuable minerals such as titanium concentrate, zircon, monazite, and rutile. These resources have a mining lifespan of over 15 years under current licenses. This strategic acquisition aligns with Hainan Mining’s focus on diversifying and scaling its operations in strategic metal minerals.

This announcement signals Hainan Mining’s intent to strengthen its foothold in the strategic resources sector. However, critical factors such as valuation transparency, risk management, and financial sustainability will be key to the success of this transaction.

Hainan Mining is a China-based company principally engaged in the mining, mineral processing, and sales of iron ores. The Company’s primary products are iron ore products, including lump ores, fine and iron powder, and other iron products.

China and Mozambique share a strong bilateral relationship rooted in historical, political, and economic ties. Over the past decades, this partnership has evolved significantly, driven by China’s growing influence in Africa and Mozambique’s strategic importance due to its resource wealth and geopolitical location.

Mozambique has rare earth elements (REEs), though they are not yet fully developed or widely exploited compared to its other natural resources like coal, natural gas, and heavy mineral sands (titanium and zircon). The presence of rare earth elements in Mozambique has been identified in various mineral deposits, particularly in the northern and central regions of the country.