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Highlights

  • MKA to combine with CPTK and form Mkango Rare Earths Limited with Nasdaq listing planned
  • Mkango Resources values its stake in the new entity at GBX 400 million pre-transaction costs
  • The merged platform to integrate Songwe Hill and Pulawy projects across Africa and Europe

Mkango Resources Ltd (LSE:MKA), a Canada- and UK-listed rare earths development company, announced that its wholly owned subsidiary Lancaster Exploration Limited (to be renamed Mkango Rare Earths Limited) has signed a definitive Business Combination Agreement with Crown PropTech Acquisitions (OTC: CPTKW), a Cayman Islands special purpose acquisition company (SPAC). The agreement marks a strategic step in establishing a vertically integrated rare earth supply platform with projects located in Malawi and Poland.

Under the agreement, Mkango's subsidiary and other affiliates involved in the combination will become part of a newly named entity, Mkango Rare Earths Limited (MKAR), which will apply to be listed on Nasdaq, pending necessary approvals. Mkango is expected to retain a significant majority equity interest in MKAR upon completion.

Mkango's rare earth assets include the Songwe Hill project in Malawi and the Pulawy separation facility in Poland, both designated as Strategic Projects under the European Union’s Critical Raw Materials Act (CRMA). Songwe Hill is additionally supported by the Minerals Security Partnership, a multinational initiative to secure global mineral supply chains. The goal of the combined entity is to supply mined, refined, and separated rare earth oxides to industrial customers across North America, Europe, and Asia.

The Songwe Hill project has completed a NI 43-101-compliant Definitive Feasibility Study and a full Environmental, Social, and Health Impact Assessment in accordance with IFC Performance Standards. A mining development agreement was signed with the Malawian government in July 2024. Pulawy, located in Poland, is expected to process purified rare earth carbonates from Songwe Hill and potentially other sources. As an EU-based operation, Pulawy is anticipated to benefit from streamlined permitting timelines as part of its strategic project designation.

The pro forma valuation of Mkango's interest in MKAR is estimated at GBX 400 million, excluding transaction costs, SPAC redemptions, or proceeds from potential private investment in public equity (PIPE) financing. At the time of closing, Mkango is expected to hold approximately 40 million shares in MKAR, while CPTK’s initial shareholders would hold around 6.9 million shares. Final ownership will depend on financing adjustments and other closing conditions.

The agreement includes the conversion of sponsor investments in the form of convertible notes (BCA Note and F-4 Note), which may convert to equity based on various terms tied to the proposed valuation. Additionally, approximately 14.2 million public and private CPTK warrants will become exercisable for MKAR ordinary shares after the transaction is completed.

The combined company will not include Mkango’s recycling businesses, which remain outside the scope of the business combination. Shareholders of Mkango will be asked to approve the transaction and a proposed name change in a forthcoming meeting.

Funds raised from the proposed combination, including the Sponsor Investment and any PIPE financing, are expected to support the continued development of Songwe Hill and Pulawy.

As of 3 July 2025, Mkango’s shares were trading 50% higher at GBX 26.25 per share.