Trek Metals (ASX:TKM) announced that US-based Advanced Energy Fuels has exercised its option to acquire Trek's non-core Hendeka-South Woodie Woodie Manganese Project in Western Australia’s Pilbara region.
The move follows the option and acquisition agreement signed between the two companies in September 2024.
Under the deal, Trek will receive $450,000 in cash and 8 million shares in the TSX-V-listed company resulting from AEFI's reverse takeover of Cavalry Capital, expected to be renamed AE Fuels Corporation.
Based on recent subscription pricing, Trek's stake is valued at approximately $2.2 million, representing a 19.31% shareholding in the re-listed entity.
The cash proceeds will be directed towards advancing priority gold and high-grade manganese targets at Trek's Christmas Creek Project.
Settlement is expected within 10 business days. Following completion, Trek CEO Derek Marshall will join AEFGL as a non-executive director.
Marshall said the transaction provides Trek with substantial exposure to the Hendeka-South Woodie Woodie Project’s potential while allowing the company to focus on its flagship Christmas Creek Manganese & Gold Project in the Kimberley region.