London-listed Mkango Resources (AIM:MKA)  has completed an acquisition in rare earth magnet recycling company, HyProMag.

Mkango detailed that its subsidiary, Maginito, invested a total £300,000 for an initial 25% interest in HyProMag with a four-year option to increase its stake to up to 49% by investing an additional £1 million.

HyProMag has developed a method at the University of Birmingham for extracting and demagnetising neodymium iron boron alloy powders from magnets embedded in scrap and redundant equipment, the statement detailed.

The process is named HPMS and aims to generate potential synergies, such as the blending of primary production metals from the group’s Songwe Hill operation in Malawi with recycled production from HyProMag.

The transaction will also offer product off-take and marketing rights for greater flexibility and access to downstream markets for the rare earth magnets which the company explained are ‘critical materials’ for a vast range of technology applications including electric vehicles and wind turbines.

William Dawes, Chief Executive of Mkango said that the company views rare earth magnet recycling as “a major growth industry” which can complement developing sustainable production such as that at Songwe Hill.

“This investment further enhances Mkango's role in developing a robust and sustainable electric vehicle and clean technology supply chain for global markets,” he added.

Pursuant to the transaction, HyProMag has appointed Dawes to the Board at HyProMag -- he'll be joining the group's cohort of founding directors who are ‘leading world experts’ in the field, the company explained.

Daniel Mamadou, Executive Director of Talaxis, a subsidiary of commodity trader Noble Group and 24.5% shareholder of Magnito said the investment marked “an exciting step” for everyone involved.

“We are proud to be part of a project that has the potential to revolutionise the magnet recycling sector and support the growing global shift towards renewable energy and electric vehicles,” he added.

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