Troubled potash player Kalium Lakes is expected to collapse into liquidation after Reward Minerals failed to drum up the funds to buy its Beyondie potash project.
Troubled potash player Kalium Lakes is expected to collapse into liquidation after Reward Minerals failed to drum up the funds to buy its Beyondie potash project.
On the ASX today, McGrathNicol administrators on behalf of Kalium, and its subsidiaries Kalium Lakes Potash and Kalium Lakes Infrastructure, announced the business was expected to collapse into liquidation in the coming days.
In a statement yesterday, Reward said despite an “exhaustive effort” it had been unable to secure sufficient funding to complete the acquisition of Kalium’s flagship Beyondie sulphate of potash project 160 kilometres south-east of Newman.
“Reward has advised that it had been unable to secure sufficient funding to complete the SSA and therefore is unable to satisfy the conditions precedent,” today’s statement read.
“The receivers have therefore executed a termination deed with Reward as at today’s date.
“Kalium Lakes Potash Pty Ltd and Kalium Lakes Infrastructure Pty Ltd are now expected to enter liquidation in the coming days.”
It comes after Reward emerged as a potential buyer with a $20 million proposal to buy the potash project. It launched and later revoked a renounceable entitlement offer to raise $22.7 million to fund the acquisition and provide capital.
On February 16, Reward announced it had withdrawn the entitlement offer, and claimed the deal to acquire Beyondie remained on foot but warned there was no guarantee an alternative proposal would materialise or be completed.
Rewards’ shares crashed following today’s announcement, closing the day down 40 per cent to 3 cents per share.
Kalium’s Beyondie project had been producing sulphate of potash since September 2021 but struggled due to technical and supply-related issues before running aground.
Despite raising additional capital and exploring its options via a strategic process the company was unable to stay afloat, later appointing receivers from KPMG and administrators from McGrathNicol in August 2023.
In September, receivers told the market it had found a potential buyer in Agrimin to acquire the Beyondie potash project, but the buyer terminated the deal the next month.
Kalium Lakes and its subsidiaries are expected to enter liquidation in the coming days.
In yesterday’s announcement, Reward said it was conducting due diligence activities on new projects within the minerals sector for potential acquisition.
