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World Titanium Resources Gains Substantial Shareholder, Interest On The Rise

World Titanium Resources (ASX: WTR) has received a substantial shareholder notice from Blakeney LLP, which holds a 5.55% interest after share purchases in March and April.

Blakeney holds 16.57 million shares in the company after acquiring an additional 4.4 million shares between 27 March 2013 and 4 April 2013 for a total consideration of A$1.1 million.

The level of interest in World Titanium is on the rise - reflecting the size, the grade and value accretion of the proposed transaction with Sichuan Lomon Titanium .


Investor interest has been strong in World Titanium recently with shares rising 47% to its current share price of $0.25, compared to the price in early March.

This is less surprising given the deal that World Titanium chairman Wayne Malouf and CEO Bruce Griffin have struck with Sichuan Lomon Titanium, a major Chinese titanium dioxide pigment producer, to jointly develop the Ranobe Mine, part of the Toliara Sands Project.

Under the deal, Lomon agreed to a placement at a premium to the share price at the time of the announcement for up to $8.2 million and to contribute the entire US$300 million capital required to develop an 800,000 tonne per annum ilmenite mine.

The joint venture would secure all funds required for a much larger initial development at Ranobe, and eliminate the need for World Titanium to raise any development equity or debt capital.

World Titanium would also secure an offtake commitment for 80% of the ilmenite that the mine would produce, sufficient to cover all operating costs in almost any price environment.

Now the Lomon transaction is subject to a 90 day detailed due diligence period from 15 March 2013, but if all goes well, the financing and offtake risk for the project will be dramatically reduced.

By which time, World Titanium may have struck one of the best deals we can recall in recent times. In which case further gains in the valuation can be expected.

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