A few months ago, another ASX listed junior resource company with a magnetite resource in Canada was low on funds and had a market cap of less than $20M.
Cyclone (ASX:CLE) then signed an MoU with Vale which has now been finalised. Vale will provide funding in tranches of US$18M to earn 30% and up to $US$120 and get 75% when money spent or they make a decision to mine. Vale then have the option to but out CLE's 25% or provide funding for CLE's 25% into production.
Whilst there are many differences between MGT's Razorback and CLE's Iron Bear project, it does go to show that a junior with a very small market cap can pull off a company changing deal with a significant and strategic JV partner.
It also shows that there is interest from the big end of town in projects that can produce high grade low impurity iron ore suitable for making green steel.
MGT Price at posting:
9.9¢ Sentiment: None Disclosure: Not Held
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