- A tungsten miner is heading to the US market. The company that will be known as Kaz Resources plans to go public next year through a direct US listing in a proposed $2 billion deal, The Wall Street Journal reported. Its main asset is a planned tungsten mine in Kazakhstan that is partially owned by the country’s state mining company.
- The Trump sons keep a small stake. Donald Trump Jr. and Eric Trump are set to hold an ownership stake of below 1%, worth less than $20 million at a $2 billion valuation, according to a person familiar with the matter. Mining executive Pini Althaus said they are passive investors whose role in the company is nonexistent.
- Washington is backing the project. The Export-Import Bank and the International Development Finance Corp. have issued letters of interest for up to $1.6 billion in funding, and Dominari Holdings has agreed to inject $32 million through its American Ventures investment vehicle. The company estimates the mine could produce 15% of global output and hopes to start production in 2030.
- The plan replaces a contested merger. The direct listing supplants a pending merger with Nasdaq-listed Skyline Builders that drew fire from Sen. Elizabeth Warren over alleged conflicts of interest. Skyline shareholders will still own more than a quarter of the company once it is listed.
What Happened?
Kaz Resources said it plans to sell shares to the public next year through a direct listing, which Althaus called “a cleaner, quicker way for us to become a publicly traded company.” The Trump brothers gained an indirect stake through Dominari Holdings, a Trump Tower-based financial firm they partially own, which helped lead an investment last year in Hong Kong infrastructure company Skyline Builders. Skyline then agreed to merge with Althaus’s Kazakh assets. That merger will be scrapped, though Skyline investors, including the Trumps, keep stakes. The company is running a feasibility study and is in talks to sell its metal to US companies.
Why It Matters?
The deal gives investors another way to bet on America’s race to secure critical materials used in munitions, chips and more. China dominates tungsten supply, and tighter export controls have sent prices surging, prompting the Defense Department to move toward a ban on Chinese tungsten and make a $450 million investment in a US producer. “I wouldn’t say it’s quite panic,” Althaus said. “But we’re getting there around long-term tungsten supply.” The Trump family link, however, guarantees continued political scrutiny that could weigh on the listing.
What’s Next?
Watch for the timing and valuation of the direct listing next year, progress on the feasibility study and whether the Ex-Im Bank and DFC letters of interest become firm funding commitments. Political scrutiny is likely to continue: Althaus said he would be surprised if lawmakers did not ask him to appear on Capitol Hill, adding, “There’s no smoking gun here.”
Affected Tickers and Coins: DOMH, SKBL, REMX
Source: WSJ
