SINGAPORE (May 16): ISR Capital reported 1Q net loss widened to $0.39 million from $0.37 million a year ago.

This was due to the consolidation of financial statements of newly acquired Tantalum Holding (Mauritius) (THM) and its wholly owned subsidiary Tantalum Rare Earth Malagasy SARLU (TREM) into the group’s 1Q financial statements which increased its other expenses by 87.1% to $379.3 million.

No revenue was also recorded for 1Q19 compared to revenue of $0.17 million in 1Q18 which was related to interest income earned on debt securities.

ISR on Jan 3 completed the acquisition a 60% stake in Tantalum Holding (Mauritius) (THM) which owns 100% of TREM, which in turn holds an exploration licence for a rare-earth mining concession in Madagascar.

In its commentary statement, ISR said while the group had legally completed the acquisition of 60% of THM, it will hold the extraordinary general meeting ordered by Singapore Exchange Regulation in due course.

In a Jan 10 notice of compliance, SGX RegCo ordered ISR to hold an EGM to seek shareholder approval for the waiver of a condition related to the Madagascan acquisition before paying for the deal with some 747.3 million new shares.

See: SGX RegCo orders ISR Capital to seek shareholders' approval for waiver of condition

The waiver, if approved, allows ISR Capital to excuse itself from the preparation of a cashflow budget and liquidity plan which is vital for the purpose of determining and planning the company’s working capital requirements of up to six months.

Explaining the need for an EGM, SGX RegCo said there was a need for ISR to adjust and update over time the US$10–15 million preliminary estimates provided by ISR in its acquisition prospectus as the numbers derived by chairman Chen Tong were based “on his mine development experience and through discussions with consultancies”.

In its outlook statement, ISR expects the 5G revolution to boost demand for rare earth elements and says it remains committed to bringing the the 238 sqkm rare earth mine in Madagascar to commercialisation.