Sale of Kalium Lakes’ Beyondie potash project in limbo again as Reward Minerals raising falls through

Reward Minerals has seemingly bitten off more than it can chew, after aborting a capital raise to gobble up Kalium Lakes’ problematic Beyondie sulphate of potash project in WA’s Little Sandy Desert. Nedlands-based Reward told the market late on Friday it would withdraw a $22.8 million rights issue announced last month to fund the $19.8m purchase of Beyondie. The West Australian understands a poor uptake of the rights issue — comprising of two new shares for every share held, plus a free attaching option for every two new shares — forced the funding arrangement to be abandoned. Shares in Reward have been suspended from trading since February 5 and are expected to remain halted for at least another week. ASX-listed Kalium collapsed into hands of administrators from KPMG in August owing more than $200m to lenders, including the Federal Government’s Northern Australian Infrastructure Facility. Receivers from McGrathNicol snatched the keys to the flagship Beyondie asset shortly after. In November The West Australian first reported Reward’s interest in Beyondie, as well as the potential difficulties in getting a deal to land — given the fledgling potash player’s market capitalisation at the time was just $9m. Despite the rights issue falling through, Reward told the market on Friday it is in “advanced discussions” with the receivers regarding an “alternative proposal”. While Reward’s acquisition of Beyondie looks to be on shaky ground, there may be a small reprieve for Kalium’s shareholders on the horizon. The West understands a deal between KPMG and Sydney-based Bennelong Capital Partners to offload shell of Kalium is set to be finalised by May, following a creditors meeting on Friday. Bennelong specialises in reviving suspended stocks on the ASX via reverse takeovers or back door listings, which will enable Kalium’s investors to liquidate their stranded shares and realise capital losses to reduce their tax bills. “When companies go into administration the shares are effectively frozen — it’s a big problem — so we can help facilitate those tax losses for shareholders,” Bennelong Capital Partners boss Steve Nichols told The West. In October 2021 Kalium produced Australia’s first potash via Beyondie, however the project was plagued with technical issues as the producer endeavoured to ramp up Beyondie towards its 120,000-tonne per annum nameplate capacity. McGrathNicol fielded a bid from fellow ASX-listed potash play Agrimin seeking to buy the project in September, but that $45m deal disintegrated. Potash — which is predominantly used as a fertiliser ingredient — has struggled to build momentum as an industry in WA.