Yankuang Energy Group (01171) will become the largest shareholder of Highland Resources after the transaction by injecting assets and subscribing for cash.

Yankuang Energy Group (01171) announced that on September 23, 2024, the company signed an "Implementation Agreement" and "Equity Subscription Agreement" with Highland Resources. Through asset injection and cash subscription, the company will acquire additional shares of Highland Resources, becoming the largest shareholder of Highland Resources and controlling the board of directors (in this transaction). According to the "Implementation Agreement," the company will transfer its 100% equity in Yancoal Canada Resources Co. Ltd. to Highland Resources. Highland Resources will issue common shares at a price of 0.50 Australian dollars per share as consideration for the transaction. As of April 30, 2024, the company's wholly-owned subsidiary, Yancoal International (Holdings) Limited (Yancoal International), provided shareholder loans totaling $83.25 million to Yancoal Canada. The principal of the above loan and corresponding interest are intended to be converted into equity of Yancoal Canada before the completion of this transaction, or directly subscribe to shares of Highland Resources at a price of 0.50 Australian dollars per share at the time of completion (share swap transaction). According to the "Equity Subscription Agreement," Highland Resources will privately issue shares to several strategic investors, including the company, at a price of 0.50 Australian dollars per share, raising $220 million. The company intends to participate in the subscription with an amount not exceeding $90 million. If other strategic investors subscribe for more than $130 million, the company's subscription amount can be reduced accordingly (cash subscription transaction). The raised funds will mainly be used for the capital expenditure required for the Muga project (Highland Resources' potash mining project) and general working capital needs. The announcement stated that this transaction will increase the company's revenue level, create opportunities for profit growth in the mining business; synergize with the Solvay project in Yancoal Canada, and achieve value appreciation of the company's assets; develop and operate potassium mine resources overseas to enhance and strengthen the company's mining business.