Ego to purchase cobalt recovery company Cobatec

Shares of Ego Resources (TSE) reached a 52-week high of 83 cents recently when the company agreed to purchase a private company that has developed a low-cost process to recover cobalt from high-grade feedstock.

Subject to regulatory and shareholder approvals, Ego will acquire all the issued and outstanding shares of Cobatec. To satisfy the purchase price, Ego will issue about 16% of its post-purchase shares to Cobatec shareholders. Using standard hydrometallurgical processes, Cobatec has developed a low-cost cobalt recovery process, Ego says, and has secured a source of cobalt feedstock in northern Ontario.

Ego President Edward Wenger refused to comment on the deal until information is mailed to shareholders on April 1. A shareholder’s meeting will be held May 4.

Ego, which traded recently 67 cents in a 52-week range of 4 cents to 83 cents, expects a recovery facility to be operating within the next year.