
HyProMag sale takes rare earth recycling to the US
Canadian minerals firm Mkango Resources has bought UK rare earth recycler HyProMag in a deal worth £5m (€8m) that takes the technology to the US.
Mkango’s joint venture Maginito has increased its ownership of HyProMag from 42% to take full control of the UK operation and a 90% stake in the German subsidiary.
HyProMag is building a plant in the UK to recycle rare earths which are vital for magnets in motors for electric cars and wind turbines as well as in smartphones using a process called Hydrogen Processing of Magnet Scrap (HMPS).
The £4.3m plant at Tyseley Energy Park in Birmingham is being developed together with the University of Birmingham with a minimum capacity of 100tpa NdFeB (neodymium, iron, boron) folling a pilot plant and will be open later this year.
HPMS offers an extremely efficient method to extract magnets from end of life waste streams as a pure NdFeB alloy powder with a very low environmental footprint.
During HPMS, scrap magnets are exposed to hydrogen at atmospheric pressure and room temperature. The NdFeB magnets break apart and crucially the powder which is generated is demagnetised which makes it easier to extract. The nickel coating peels away from the surface of the magnets and this can be separated using mechanical means.
The extracted NdFeB powder is of a purity whereby it can be re-processed into new magnetic materials or rare earth alloys.
Providing a source of the rare earths in the UK, Germany, United States and other jurisdictions via HPMS is a significant opportunity to fast-track the development of sustainable and competitive recycled rare earth magnet production as well as a key part of Europe’s sovereign supply chain requirements.
The deal is £1m (C$1.69m) in cash and the issue of 9,742,031 Mkango common shares equivalent to £1m (C$1.69m). Up to a further £3m (C$2.54m) may be payable in four tranches against certain production milestones in the period to 30 June 2026. Approval of the deal is expected no later than the third quarter of 2023, and the company is targeting first production from the UK in 2023 and Germany in 2024, with parallel technology roll-out into the US.
The shares issued on completion will have a one-year lock up and the shares issued on milestones will have a six-month lock up.
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“Building on the legacy of innovation in rare earth permanent magnets and hydrogen technologies pioneered by the late Prof. Rex Harris at the University of Birmingham, we founded HyProMag in 2018 with Rex as a founding shareholder,” said David Kennedy, Director of HyProMag, said
“Our aim was to accelerate the commercialisation of the HPMS process, and our collaboration with Mkango has supported the company’s growth and enabled the participation in major collaborative projects on rare earth magnet recycling. We look forward to the next phase of growth at Tyseley Energy Park, scaling up the technology and showcasing rejuvenation of Birmingham’s industrial heritage, in parallel with the international roll-out.”
The Maginto joint venture with CoTec in March provided the funding for the cash element of the deal and supports the roll-out of HPMS into the US, evaluating the development of recycling, chemical processing, alloy and magnet manufacturing. Scoping studies and site selection is underway ahead of feasibility studies for a US plant that could be backed by the US Inflastion Reduction Act.
“Since acquiring our initial interest in HyProMag in 2020, we have seen the company go from strength to strength, de-risking and further scaling-up the patented HPMS rare earth magnet recycling technology, building the team and developing further industry partnerships, all against the backdrop of growing interest in recycling and sustainable rare earth supply chains,” said William Dawes, CEO of Mkango. “We look forward to working closely with the HyProMag team as we continue to support the growth of the business.”
“This transaction is a major step forward for Maginito as it seeks to move into production over the short to medium term in the United Kingdom, Germany and the United States,” saidJulian Treger, CEO of CoTec. “We look forward to supporting and working with Mkango, Maginito and the HyProMag team to roll out this innovative and highly energy efficient recycling technology, both as a Maginito shareholder and as a partner in the United States.”
HyProMag was founded in 2018 by the late Professor Emeritus Rex Harris, former Head of The Magnetic Materials Group (MMG) within the School of Metallurgy and Materials at the University of Birmingham with Professor Allan Walton, current Head of the MMG, and two Honorary Fellows, Dr John Speight and Mr David Kennedy who have significant industry experience.
