TPI provides its latest research note on Alien Metals Limited (UFO.L).

Alien has announced that it has entered a conditional share sale agreement (‘SSA’) to increase its interest in the Hamersley Iron Direct Shipping Ore (‘DSO’) project (‘the Project’) from 51% to just over 90%.

Backed by recent strong results from its maiden drilling program on the Hancock Iron Ore project (‘Hancock’), and with iron ore prices having recently touched record highs, tracking Chinese steel output which is now a full 16% higher than this time last year, the rationale for this move is clear. In obtaining the major controlling interest, the Board will secure much greater flexibility to both manage and monetise the Project as continuing exploration takes it further up the value curve at a time when governments worldwide are committing significant new funding to major, longer-term infrastructural projects in an effort to kick-starting their post-Pandemic economies. With the transaction being funded primarily through equity and warrants, Alien’s fund raise of 23 November 2020, left it well capitalised with around £4.3m (US$5.8m) committed for its planned 2021 program of works, some of which has already been allocated for a follow-up program on Hancock that is expected to commence shortly.

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We would draw your attention to the various disclaimers in the document both at the beginning and at the end of the note. Retail clients (as defined by the rules of the FCA) must not rely on the research document. In particular you should note that the research document is a non-independent marketing communication. The analyst who has prepared the research is aware that TPI provides research to Alien Metals Limited. Accordingly the research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibitions on dealing ahead of its dissemination.

The information in the document is published solely for information purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. The material contained in the document is general information intended for recipients who understand the risks associated with equity investment in smaller companies. It does not constitute a personal recommendation as defined by the FCA or take into account the particular investment objectives, financial situation or needs of individual investors nor provide any indication as to whether an investment, a course of action or the associated risks are suitable for the recipient.

Copyright © 2021 Turner Pope Investments (TPI) Limited, all rights reserved.

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