EQR expands tungsten operations with strategic acquisition

EQ Resources (ASX:EQR), a global producer of tungsten, has announced a binding Heads of Agreement to acquire a full interest in Tungsten Metals Group Limited and its subsidiaries. This acquisition includes shares in Asia Tungsten Products Co Ltd, collectively known as TMG Group. TMG operates the largest ferrotungsten plant outside China, based in Vietnam. The deal is valued at A$13.5 million and aims to boost EQR's presence in the tungsten supply chain. Completion is anticipated in the first half of 2025, pending due diligence and approvals.

EQR's strategic move and future outlook

EQ Resources Limited's acquisition of TMG Group positions the company to enhance its tungsten supply chain and expand its market presence. The acquisition aligns with EQR's goals of becoming a leading supplier of tungsten and diversifying its operations. TMG's ferrotungsten plant in Vietnam offers significant production capabilities, strengthening EQR's competitive edge. Financially, the deal involves the issuance of new shares and a cash payment. The acquisition process, requiring shareholder and court approvals, is set to conclude in the first half of 2025. This strategic move reflects EQR's ambition to grow in the critical minerals sector and mitigate risks associated with resource estimates and production targets.

Executive insights on strategic acquisition

The acquisition aligns with EQR's strategic initiatives to become a leading western tungsten producer. It allows for vertical integration, leveraging EQR's existing resource base and production output across the tungsten supply chain.