Hamburg/Silicon Valley – CMS advised the German development bank (KfW) on a strategically significant investment in the Nolans Project in Australia. The investment will take the form of a planned equity investment in the listed company Arafura Rare Earths Limited (ARU). The subscription for new fully paid-up ordinary shares in ARU should reach a volume of up to EUR 50 million and, according to the existing transaction documents, is expected to account for around five per cent of ARU's issued share capital.
A CMS team led by Dr Eckart Gottschalk and Dr Holger Kraft provided comprehensive advice to KfW and the Federal Republic of Germany on all legal aspects of the transaction. CMS advised KfW in particular on legal due diligence, State aid issues and the drafting and negotiation of the transaction documents, in particular the subscription and investor agreement. MinterEllison provided advice on Australian law.
With its investment in the listed parent company ARU, KfW will acquire an economic interest in the Nolans Project and in the group companies that hold the intellectual property rights and are responsible for the extraction and processing of rare earths. The Nolans Project is one of the most significant Western rare earth development projects.
The transaction is linked to the German government's raw materials fund, through which KfW, on behalf of the German government, can invest in domestic and foreign raw materials projects that contribute to security of supply. The fund serves to secure the supply of critical raw materials to German industry and to strengthen the resilience of the German and European economies. This investment underscores the strategic importance of the Nolans Project for German industry and the objective of diversifying supply chains for critical raw materials and reducing dependence on highly concentrated sources of supply.
Press Contact
presse@cms-hs.com
