Archer Materials spinout ChemX Materials floats on the local share market

ChemX made its ASX debut after completing an oversubscribed $8 million initial public offering late last year, offering investors a chance to subscribe for 40 million shares at $0.20 apiece.

Archer Materials Ltd (ASX:AXE, OTC:ARRXF)’s critical minerals spinout, ChemX Materials Limited, has joined the local share market under the ticker ‘CMX’.

ChemX made its ASX debut after completing an oversubscribed $8 million initial public offering (IPO) late last year, offering investors a chance to subscribe for 40 million shares at $0.20 apiece.

As a public company, ChemX is focused on developing critical materials like high purity alumina (HPA), kaolin, halloysite and manganese for the new energy markets.

With the IPO funding runway under its wing, ChemX intends to build a pilot-scale high purity alumina plant and advance exploration over its newly acquired Eyre Peninsula assets, which it picked up from Archer in June last year.

CMX by the numbers

ChemX joined the local share market on January 18 with an implied market capitalisation of roughly $18 million.

Thanks to the pioneer offer, slightly less than 91 million CMX shares are now on issue.

With the IPO cash in hand, CMX believes it has enough of a funding runway to complete its main listing objectives.

Its proposed use of funds is varied, but more than a quarter of the funding is earmarked to develop the HPA pilot plant in Perth, Western Australia.

Targeting global energy market

Archer’s critical minerals spinout is developing materials to support a revolution in the energy market, spurred on by the rise of electric vehicles and the push for decarbonisation across the world.

Speaking to the movement in a prospectus letter, ChemX non-executive chair Kristie Young said: “The global energy sector continues to transition from fossil fuel-based systems of energy supply to renewable energy sources.

“There is an ever-increasing demand for the environmentally sustainable development and supply of materials that feed into the renewables sector.”

To capitalise on growing demand, ChemX is firming up a portfolio of critical material opportunities.

It’s currently developing its HiPurA™ processing technology, which is able to produce HPA and HPA cathode precursor salts for lithium-ion batteries.

Importantly, the process is low in energy consumption compared to alternative technologies and isn’t tied to any mine production, allowing for a quick construction time.

Following the listing, CMX is working on a product development program, which will initially focus on:

• Investigating the uses of HPA in the lithium-ion battery anode and cathode;
• Investigating the use of lower carbon-intensive materials and processes in existing industrial processes; and
• Producing a manganese sulphate product for use in battery technology.

The company is also actively looking to collaborate with other entities and research institutions in a bid to generate the materials needed to develop its technology.

Outside of its HPA opportunities, two of ChemX’s key prospects come from parent company Archer Materials.

Up until mid-last year, the materials technology company owned two Eyre Peninsula properties — the Kimba Kaolin/Halloysite Project and the Jamieson Tank Manganese Project — but recently passed them on to ChemX.

Thanks to that transaction, Archer landed 9.25 million ChemX shares and was entitled to a further 2.32 million securities once the company completed its IPO.

Eligible Archer shareholders were also able to access the ChemX raise under a priority offer.

The ChemX team

ChemX is chaired by Kristie Young, an executive who brings more than 20 years of experience across mining, engineering, project evaluation and professional services.

Young also brings expertise across the executive search, business development & advisory and technology sectors to the CMX team.

She currently serves on the boards of Lithium Australia NL (ASX:LIT, OTC:LMMFF), Tesoro Resources Ltd, Wesley College WA & Energy Club WA.

Commenting on the ASX listing, Young said: “It is a fantastic day for ChemX as we commence trading on the ASX.

“I’d like to personally welcome all shareholders to the register and thank them for their support as we set about increasing shareholder value by growing a company focused on materials technology with sustainability at our core.

“Manganese, kaolin, HPA for lithium-ion batteries - all valuable commodities. I’d also like to acknowledge the hard work of our board, executive and advisors to deliver this IPO.

ChemX managing director David Leavy joins Young at the helm, bringing more than 25 years of experience in commodity markets to the role.

Leavy previously held executive roles with a number of advanced mining companies across varying commodities and jurisdictions.

In the last four years, his work has been focused on HPA production technologies and markets.

Leavy commented: “Our ability to achieve this fantastic result speaks to the outstanding growth potential inherent in our assets, the exceptional work our team has done to date, and confirms our view of the significant opportunities in the transformational markets we are targeting.

“ChemX is well-funded to execute its strategy to develop its HPA technology and explore the Kimba Kaolin/Halloysite and Jamieson Tank Manganese projects in South Australia with the aim of supplying materials to the energy transition and decarbonization markets.

“We have hit the ground running and expect to deliver a solid amount of news flow in advancing the development of our HPA business and exploration from the Kimba Kaolin/Halloysite and Jamieson Tanks exploration projects in CY22.”