Mentioned:
The Department of War is deepening their focus on domestic tungsten supply. Which is exactly why they’re pouring hundreds of millions of dollars into a publicly traded company.
What’s happening:
- The Elmet Group (NASDAQ: ELMT) has landed a strategic investment from the United States Department of War for $450M USD
By the numbers:
- The $450M USD in funding will be drawn down in tranches, with $200M USD being released at closing
- The United States Department of War will receive redeemable preferred equity and warrants in The Elmet Group for up to 19.9% of the company
Why it matters:
- This is the single largest equity investment the United States Department of War has ever made to a publicly traded company focused on tungsten
Going deeper:
- The Elmet Group has publicly stated they will use the new funding to expand their production capacity for tungsten at their plants in Maine, Michigan and Ohio as well as to fund a joint venture with Blue Moon Metals (NASDAQ: BMM) and EQ Resources
- The United States Defense Logistics Agency has also separately given The Elmet Group a contract worth up to $2B USD to supply tungsten ores, concentrates and sodium tungstate to the National Defense Stockpile
The fine print:
- Only $150M USD of the new $2B USD contract from the Defense Logistics Agency is a guaranteed commitment
