Some extracts from this report:Different parties could easily...

Some extracts from this report:

Different parties could easily have widely divergent views as to the value of these deposits depending on their own perceptions of the attributes of the sublease deposits and their appetite for risk.

While the Proposal is relatively small in the context of Lynas market capitalisation, the involvement of Mr Nicholas Curtis as Chairman of, and a shareholder in, both Lynas and Forge means that the Proposal must be carefully scrutinised

Mr Curtis stands to personally benefit considerably if the Proposal is approved

The only basis on which the Proposal might be challenged is that an open sale process has not been pursued by Lynas

The sublease (Crown)deposits are at the early exploration stage and there is limited financial or other information available in relation to these deposits.

There are no development plans for the deposits and a processing method to extract the rare metals has not been identified. Without identification of an extraction process, capital and operating costs cannot be estimated and cash flow models cannot be developed. Consequently forward looking information of this nature was
not provided by Lynas or Forge.

The only way to reliably determine the market value of the sublease deposits would be through an open sale process

As early stage exploration deposits with no process identified to extract the rare metals, the sublease deposits are not capable of being valued by applying usual methodologies such as discounted cash flow analysis.

The sublease deposits are early stage exploration deposits and it is not possible to attribute value to these kinds of assets with any confidence.
There are substantial uncertainties and risks attached
to the future development and production of these deposits and there is no information available to enable the preparation of a discounted cash flow analysis.

The current strategy of Lynas is to focus on becoming a leading vertically integrated rare earths producer.

Lynas does not intend to allocate the significant capital and management resources required to investigate the exploitation of the sublease deposits in the foreseeable
future.

The only basis on which the Proposal might be challenged is that an open sale process has not been pursued by Lynas

Lynas has not undertaken any work since 2004 to categorise further JORC Code resources for rare metals at Mt Weld.

Lynas management has stated that, given its focus on developing the Mt Weld rare earths project, further work on rare metals is not a priority.

The Mt Weld area hosts significant phosphate resources.

Total phosphate resources in the Mt Weld regolith were re-estimated by Hellman & Schofield in 2011 H&S estimated a total resource of 213Mt at 13.9% P2O5 at a 10% P2O5 cut off which included crandallite and rare earth phosphate in addition to residual apatite phosphate.


Lynas has estimated that the total transaction costs of the Proposal will be approximately $780,000, the vast majority of which will have been incurred prior to the time that non associated shareholders of Lynas vote on the Proposal

The decision whether to vote for or against the Proposal is a matter for individual shareholders
based on each shareholder views as to value,