SINGAPORE (Mar 1): ISR Capital’s planned acquisition of a tantalum concession is taking longer than expected.

The company today announced that the long-stop date for the acquisition will be extended – yet again – to June 30, from the previous deadline of Feb 28.

The controversial acquisition, for 60% of the concession in Madagascar, was initially set at $40 million to be paid in new ISR shares at 10 cents each. That helped spark the surge in ISR shares to as high as 33 cents in October 2016.

ISR tried to justify this acquisition by putting forward two valuation reports that were both similar in content and appraised price: US$1 billion.

The two valuation reports were criticised by the SGX. The two valuers, both based in Australia, have been temporarily suspended by their industry body, The Australasian Institute of Mining and Metallurgy.

See: ISR Capital admits Madagascar concession has ‘much lower’ value

Under company chairman Chen Tong, ISR pushed ahead with the tantalum concession acquisition.

It commissioned a third valuation report, which gave a substantially reduced figure of US$48 million.

See: Third independent assessment puts 'most likely value' of ISR Capital's Madagascar concession at US$48 mil

The acquisition terms were then revised in August 2017 from $40 million to $4.52 million, to be paid with 674.8 million new ISR shares at 0.67 cent per share.

On Jan 25, Chen raised his stake in the company substantially. He bought more than 246 million shares at an average of 0.512 cent per share, raising his total stake to 10.51% from just 0.92% earlier.

See: ISR chairman Chen Tong raises stake to more than 10%

In the half year to October 2016, shares of ISR Capital surged some 4,000% on news of the planned acquisition of Tantalus Rare Earths (TRE).

However, when alleged penny stock saga mastermind John Soh was arrested on Nov 25, 2016, shares of ISR Capital crashed by more than half within the day. Prosecutors alleged that Soh had manipulated ISR shares as well.

See: Prosecutors confirm links between ISR Capital and John Soh

Soh has been held in remand since. He was denied bail yet again on Feb 27, although the court did urge for the trial proper to start soon.

See: Court denies bail for John Soh; cites flight risk and danger of witness tampering

ISR on Thursday reported that losses for the year ended Dec 31, 2017, narrowed by more than 82% from the preceding year to $1.4 million. Revenue in the same period was up 64.8% to $576,075 on higher interest income earned on debt securities.

Despite the delay, ISR seems keen to push ahead with the acquisition, citing its confidence in the market potential of rare earths in various industries.

“In particular, car manufacturers will need rare earths to make durable batteries for electric vehicles, the demand for which is growing rapidly and has yet to reach its peak,” the company states.

“It will continue efforts to obtain the necessary regulatory and shareholder approvals to complete the above acquisition,” ISR adds.

ISR shares closed flat at 0.5 cent on Thursday.