Tas Government buys equity share of King Island tungsten mine

The Tasmanian Government has acquired an equity share of Group 6 Metals, operator of the King Island tungsten mine, with an agreement to convert its existing $10 million loan to equity.
 
Minister for Business, Industry and Resources, Eric Abetz, said the mine is a critical part of the King Island economy, supporting around 95 direct jobs and many local businesses.
 
“The Dolphin Tungsten Mine is a major employer on King Island and a key contributor to the local economy,” Minister Abetz said.

“To give the mine the best chance of success, the Government is converting its existing $10 million loan into an equity stake in Group 6 Metals, as part of a broader turnaround plan developed by the company and its senior lenders."

This includes the appointment to the company's board in early December of Dale Elphinstone, a significant share-holder in the company and reportedly one of Tasmania's richest men.

“This is intended to be a short to medium-term investment to help stabilise the mine through challenging global conditions," Senator Abetz continued.

“The Tasmanian Government remains committed to working closely with the company to support the mine’s ongoing operations and ensure its long-term viability.”

It is unclear how much equity the Tasmanian Government will acquire as part of the agreement.

The equity conversion remains subject to regulatory and shareholder approvals.

Trading in G6M shares remains suspended.