Reach Resources (ASX:RR1) to receive $800,000 from sale of non-core assets

Reach Resources has announced that it will receive an additional $800,000 following the sale of non-core assets that were subject to an earn-in and joint venture agreement with Electrostate Malinda Pty Ltd, a wholly owned subsidiary of Delta Lithium.

The transaction comprises a combination of cash and shares and will result in the termination of the existing joint venture agreement upon completion.

Highlights

• Additional $800,000 to be received from the sale of non-core assets.
• Consideration comprises $400,000 cash and $400,000 in Delta Lithium shares.
• Delta shares will be calculated using a 30-day VWAP prior to 15 June 2026.
• Completion of the transaction will terminate the existing joint venture agreement.
• Each party will be released from all claims and obligations arising under the agreement.
• The company stated the transaction removes future expenditure commitments and holding costs associated with the non-core assets.

The assets being sold are those subject to the earn-in and joint venture agreement executed with Electrostate Malinda Pty Ltd in March 2024.

According to the announcement, the agreement will terminate on completion of the sale and each party will be released from all claims and obligations arising under the joint venture agreement.

The sale relates to a package of non-core assets comprising granted mining and exploration tenements and pending exploration licence applications.

The announcement noted that, following completion, Delta will assume responsibility for the pending tenement applications, and once any tenements arising from those applications are granted to Reach, they will be transferred to Delta for no additional consideration.

The company stated that the transaction removes future expenditure commitments and holding costs associated with the non-core assets.

Reach Resources Chief Executive Officer Jeremy Bower said:

“The divestment of these non-core assets represents a compelling outcome for the Company on multiple fronts. We will receive $400,000 in cash and $400,000 in shares in Delta Lithium, a company we have confidence in and which offers genuine potential for capital growth. Importantly, completing this transaction also eliminates the considerable holding costs associated with these assets going forward. Combined with the $6 million received via the issue of shortfall shares, placement shares and receipt of the non-refundable option fee as announced last week, the Company has now received close to $7 million in aggregate, leaving us very well-funded to accelerate work at Murchison South and pursue additional opportunities with confidence.”

Upon completion of the sale, the joint venture agreement with Delta Lithium will terminate and each party will be released from all claims and obligations arising under the agreement.

The transaction is expected to deliver the announced consideration of $400,000 in cash and $400,000 in Delta Lithium shares.

Reach stated that the additional funding will be received following completion of the sale as the company continues to advance Murchison South.

The company will also retain exposure to Delta Lithium through the share component of the transaction.

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