Vancouver-based mineral exploration and development company Tactical Resources Corp (TSXV:) surged higher Friday on news that it plans to list on NASDAQ via a merger with a special-purpose acquisition company, Plum Acquisition III Corp (NASDAQ:).
Tactical Resources Corp shares rose 120% on the TSX Venture Exchange in afternoon trading Friday.
The proposed merger and listing is expected to be completed in the fourth quarter of 2024, subject to customary closing conditions, including regulatory, court and stockholder approvals, the company said in a release.
The proposed entity will have an enterprise value of $589 million, assuming Tactical Resources is delivered on a cash-free, debt-free basis.
Tactical’s flagship asset, the Peak Project, a rare earth-focused project strategically located southeast of El Paso, Texas, owns the rights to acquire REEs (rare earth elements) enriched tailings and stockpiled materials extracted from the Sierra Blanca Quarry.
The Peak Project’s convenient location in a mining-friendly jurisdiction offers extensive infrastructure, including easy highway, power, water, and rail line access. The firm believes that the project will allow it to become a significant REEs producer in the country.
To be sure, the project is one of only a few rare earth hard rock Direct-Leach-Extractable projects in the world with initial quarry operating permits in place. It also has an exclusive option to purchase SBQ’s mining lease and associated infrastructure for the Peak Project.
“Today represents a significant day and an exciting milestone for Tactical Resources. We believe that this business combination with Plum will enable us to advance our growth strategy and form strategic alliances that enhance shareholder value,” said Ranjeet Sundher, chief executive officer (CEO) of Tactical Resources.
Sundher noted that Tactical Resources intends to use the capital raised to transform both domestic and international rare earth element supply chains and lessen America’s reliance on overseas critical mineral resources.
North America urgently needs to secure alternative sources of REEs as China continues to dominate the global market, supplying nearly 70% of the world’s REEs.
Tactical Resources, which has a geographic focus in the US, is focused on supplying a range of REEs to the US market to support the development of modern technologies with uses in semiconductors, electric vehicles, advanced robotics, and most importantly, national defense.
The company already has an existing operational mine in Texas with proven REEs enriched tailings already extracted, which demonstrates testing results and showcases potential future success.
“While others may be focusing on the manufacturing of singular end-products such as magnets, our focus is on the more critical raw ingredients needed to fuel the overarching rare earth elements ecosystem. Given the advanced infrastructure nearby our project, what sets us apart is that we believe we won’t need the billions of dollars and decades of time typically needed in the mining industry to put our project into production. We believe that this business combination will help position Tactical Resources to become a significant rare earth elements producer in the United States,” said Sundher.
“At Plum, we are committed to partnering with companies with strong business profiles and experienced management teams, and Tactical Resources stood out to us due to a compelling history of successes achieved by members of its management team and a very important mission to enhance national security,” said Kanishka Roy, CEO of Plum.
“With the US’s reliance on Chinese rare earth element sources, we believe that Tactical Resources is poised to play a critical role in supply chains essential to semiconductors, a clean energy future, and the national defense industry,” Roy added.
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