Mkango Resources Ltd (AIM: MKA) (TSXV: MKA) reported a cash position of US$13.6 million as at June 30, 2026, following the completion of its acquisition of the Remloy business from Heraeus Amloy Technologies GmbH.

The Calgary-based rare earth company released its financial statements and Management's Discussion and Analysis (MD&A) for the half-year period on September 1, 2026. Alongside the financial update, Mkango provided operational milestones across its recycling portfolio in the UK, Germany, and USA, as well as progress on its proposed business combination with Crown PropTech Acquisitions (CPTK).

Financial Position and Capital Raises

As of the half-year end, Mkango held US$13.6 million in cash. Subsequent to this period, the company settled the initial €5 million (US$5.8 million) cash consideration for the Remloy acquisition.

In addition to the acquisition settlement, Mkango raised US$180,515 through the exercise of warrants and options, receiving proceeds of £94,500 and C$73,350.

Remloy Acquisition and Synergies

Mkango completed the acquisition of Remloy for a total of €8 million (US$9.3 million). The remaining balance of €3 million (US$3.5 million) is payable in cash on August 28, 2028.

Remloy operates a plant in Bitterfeld, Germany, which recycles end-of-life rare earth magnets via a melting process to produce neodymium-iron-boron (NdFeB) alloy powders. The facility has a target capacity of at least 500 tonnes per year. At completion, Remloy held a stockpile of approximately 345 tonnes of end-of-life magnets and raw materials, providing immediate feedstock for both Remloy and Mkango’s HyProMag operations.

David Bender, former co-Head of Heraeus Remloy, was appointed Managing Director of Remloy effective from completion.

HyProMag Operational Updates

UK Operations

HyProMag’s recycling and magnet manufacturing plant at Tyseley Energy Park (TEP Birmingham) was officially opened in January 2026. The facility has produced 10.1 tonnes of recycled NdFeB alloy powder to date. Commercial-scale presses and sintering furnaces are fully commissioned, with small-scale magnet block production underway for customer evaluation.

A feasibility study for expanding TEP Birmingham’s capacity to a minimum of 1,000 tonnes per year has commenced. The project cost is estimated at £1.12 million, with 60% (£0.67 million) grant-funded by the UK Government under the DRIVE35 programme.

Germany Operations

HyProMag GmbH’s plant in Pforzheim, Germany, was officially opened on April 28, 2026. The site is permitted for production of up to 750 tonnes per annum of NdFeB magnets and alloys. First commissioning runs of recycled NdFeB alloy powder were announced in April 2026, with the HPMS vessel, jet mill, and presses now commissioned.

USA Expansion

HyProMag USA took occupation of its leased facility in Dallas-Fort Worth, Texas, on June 3, 2026. Detailed engineering indicates a projected capacity of approximately 1,048 tonnes per annum of recycled sintered NdFeB magnets and 478 tonnes per annum of co-products.

Based on forecast market prices, the post-tax NPV is approximately US$797 million with a real IRR of 37.1%. Using current market prices, the NPV is approximately US$416 million with a real IRR of 26.3%. The company received a letter of interest from the U.S. Export-Import Bank for potential financing of up to $92 million.

Upstream Projects and SPAC Merger

Mkango filed a Technical Report for the Definitive Feasibility Study (DFS) of the Songwe Hill Rare Earths Project in Malawi. The updated DFS shows a post-tax NPV of approximately $339 million (using a 10% nominal discount rate) and an IRR of 24.32%.

The Pre-Feasibility Study (PFS) for the Pulawy Rare Earths Separation Plant in Poland indicates a post-tax NPV of approximately $779 million and an IRR of 39.7%.

On August 31, 2026, Mkango Rare Earths Limited (MKAR) amended its promissory notes related to the Business Combination Agreement with CPTK. The BCA Note principal increased to $623,766, and the F-4 Note principal increased to $261,250. Upon board approval of the share reclassification, these debts will be released in consideration for MKAR Class A shares issued at $5.00 per share.

What the Numbers Show

The company’s capital allocation strategy prioritizes vertical integration over near-term profitability. With a cash position of US$13.6 million as of June 30, 2026, Mkango immediately deployed US$5.8 million (€5 million) post-period-end to settle the initial Remloy acquisition cost. This leaves the company with a deferred liability of €3 million due in August 2028, while leveraging the acquired 345-tonne feedstock stockpile to de-risk supply chains for its UK and German recycling operations. The simultaneous advancement of the Nasdaq-listed SPAC merger suggests a strategy to secure larger-scale equity financing for the capital-intensive upstream projects in Malawi and Poland.

Mkango Resources Ltd (AIM:MKA; TSXV:MKA) has completed the acquisition of the Remloy rare earth magnet recycling business from Heraeus Amloy Technologies GmbH for €8 million (US$9.3 million). The transaction secures a fully commissioned production facility in Bitterfeld, Germany, expanding Mkango’s integrated supply chain across Europe.

The purchase price was settled with €5 million in cash at closing. The remaining balance of €3 million is payable in cash on August 28, 2028, marking the second anniversary of completion. Euro amounts were converted to US dollars at a rate of €1.00 = US$1.16.

Operational Assets and Capacity

Remloy operates a plant in Bitterfeld that recycles end-of-life rare earth magnets via a melting process, known as medium loop recycling. This method produces neodymium-iron-boron (NdFeB) alloy powders for bonded and hot deformed magnet markets. The facility targets a capacity of at least 500 tonnes per year of NdFeB alloy powder.

At completion, Remloy held a stockpile of approximately 345 tonnes comprising end-of-life rare earth magnets, rare earth alloys, and other raw materials. This inventory serves as immediate feedstock for Remloy and HyProMag, supporting their respective growth strategies and offering future trading opportunities.

Strategic Synergies

The acquisition complements Mkango’s existing operations. HyProMag utilizes short loop recycling to produce sintered magnets, while Mkango Rare Earths UK employs long loop recycling to produce mixed rare earth carbonates and oxides. Remloy’s medium loop process fills the gap for alloy powder production.

Key synergies include:

• Supply of end-of-life magnets from the Remloy stockpile for processing by HyProMag.
• Supply of feedstock derived from Hydrogen Processing of Magnet Scrap (HPMS) by HyProMag to Remloy.
• Co-marketing of products across Mkango, HyProMag, and Remloy to provide an expanded product suite.
• Potential future supply of primary rare earth feedstock from Mkango’s Songwe Hill project in Malawi for blending with recycled feedstock.

David Bender, former co-Head of Heraeus Remloy, has been appointed Managing Director of Remloy. He will work alongside Karsten Rachut, Head of Technology, and Matthias Weber, Head of Operations, to integrate the business and capture group synergies.

What the Numbers Show

The deferred payment structure indicates a financing strategy that preserves near-term liquidity. By deferring €3 million (37.5% of the total consideration) until August 2028, Mkango reduces the immediate cash outflow while securing control over the 345-tonne stockpile and operational assets. This allows the company to utilize the acquired feedstock and potential revenue from scale-up operations to fund the future obligation, rather than drawing entirely on existing cash reserves or external debt for the full purchase price upfront.