BUSHVELD Minerals will lead a consortium in the buyout of Enerox – a €11m (£9.42m) deal that broadens its participation in the downstream vanadium battery industry.
Working through its 84%-owned subsidiary, Bushveld Energy, the UK-listed Bushveld Minerals will hold a substantial minority interest in Enerox which is currently owned by CellCube Energy Storage Systems.
Bushveld Minerals, which mines vanadium from sites in South Africa, said its holding would not exceed 50% and it reserved the right to introduce other minority partners into the consortium at a later stage.
The terms of the agreement allow Bushveld Minerals to match a competing offer. The company has until February to finalise the transaction.
Enerox has an established presence as an original equipment manufacturer (OEM) in vanadium battery technology, formally known as vanadium redox flow batteries or VRFB.
Bushveld announced last week that it would provide a $5m convertible loan to UK-listed Avalon Battery Corporation which is merging with redT energy, another UK business. The loan converts to shares in the combined entity whilst Bushveld Minerals, again working through Bushveld Energy, has the right to build a stake in Avalon in the event the proposed merger between the two companies fails.
Said Fortune Mojapelo, CEO of Bushveld Minerals regarding the latest transaction: “The potential acquisition of Enerox is in line with Bushveld’s previously announced strategy of establishing a VRFB Investment Platform through which the company will mobilise additional capital from third party funders to help credible VRFB OEMs build scale to respond to a growing stationary energy storage market opportunity”.
He added that in accelerating and popularising the scope of OEMs in the manufacture of VRFBs, Bushveld Minerals would secure a stable source of demand for vanadium, and derisk the company’s exposure to the vanadium market, which is volatile.
Bushveld Minerals said on November 7 that it was on track to meet 2019 production guidance of 2,800 to 2,900 tons of vanadium from its Vametco business unit despite undertaking a 22-day maintenance programme in the third quarter.
As a result of the programme, third quarter output fell about a quarter to 561 tons compared to 742 tons in the second quarter. The maintenance programme focused on increasing throughput rates of the crusher and mill, improving kiln availability and recoveries as well as improving leach plant recoveries.
Production in September was consequently at a record 310 tons.
