3 April 2023

Tirupati Graphite plc

('Tirupati', 'TG' or the 'Company')

Completion of the Acquisition of Suni Resources

Tirupati Graphite plc (TGR.L, TGRHF.OTCQX), the specialist graphite and graphene company developing sustainable new age materials, is pleased to announce that on 1 April 2023 ("Completion"), it successfully completed the acquisition (the "Acquisition") of Suni Resources SA ("Suni"), the Mozambique incorporated subsidiary of ASX listed Battery Minerals Limited ("BAT"). The Acquisition includes all assets, infrastructure, permits, licenses, and intellectual property associated with the construction initiated Montepuez Project and the fully permitted Definitive Feasibility Study ready, Balama Central Project (the "Projects") in Mozambique held by Suni.

·    On 17 August 2021, the Company announced it had signed agreements with BAT for the acquisition of the entire issued capital of Suni (the "SPA") and assignment of BAT's intellectual property rights ("IP Assignment") associated with the Projects ("Battery Technical Information")  for a total aggregate consideration of AU$12.5 million (£6.77 million) to be paid in a combination of AUD$1.5 million (c.£0.81 million) in cash and AUD$11 million (c.£5.96 million) in ordinary shares of £0.025 each in the Company ("Consideration Shares").

·    Under the SPA, BAT had retained the rights to reimbursement of c.AUD$ 1.5 million (c.£0.81 million) VAT refunds due to Suni for historical spends as and when received from the Mozambique tax authorities ("VAT Refunds").

·    The terms of SPA were varied as announced on 30 September 2022 and 5 December 2022 to facilitate the satisfaction of financial obligations related to the grant of approval for the transaction by Instituto Nacional de Minas de Moçambique ("INAMI") and calculation of number of Consideration Shares.

·    On 31 March 2023 the Company and BAT entered into a deed of variation of the IP Assignment. The variation provided for payment of AUD$994,571.86 (c.£0.54 million) of the total consideration of AUD$1,494,571.86 (c.£0.81 million) by the issue on Completion of TG ordinary shares of £0.025 each to BAT  at an issue price equal to the volume weighted average price of the Company's Ordinary Shares for the 5 trading days prior to Completion and the payment of the balance of AUD$500,000 (c.£0.27 million) in cash paid  to BAT by the Company on 25 January 2023.

·    The Company and BAT satisfied and met all the remaining obligations for completion of the Acquisition last week and Completion occurred on 1 April 2023.

Settlement of Consideration for the Acquisition

Under the terms of the SPA and IP Assignment as varied, the total aggregate consideration for the Acquisition is satisfied as follows:

·    The issue of 10,046,556 TG ordinary shares of £0.025 each to BAT covering a sum of AUD$9,750,000 (c.£5,284,500) at an issue price of £0.526 per ordinary share in two equal tranches as follows:

o  5,023,278 TG ordinary shares of £0.025 each issued at Completion (the "Tranche 1 Consideration Shares"); and

o  5,023,278 TG ordinary shares of £0.025 each to be issued on the eight month anniversary of Completion (the "Tranche 2 Consideration Shares").

·    Payment of a sum of AUD$5,428.14 in cash at Completion pursuant to the SPA.

·    The payment of a sum AUD$500,000 (c.£0.27 million) in cash paid by the Company to BAT on 25 January 2023 pursuant to the IP Assignment.

·    The issue of 2,018,944 ordinary shares of £0.025 each to BAT at Completion covering a sum of AUD$994,571.86 (£539,058) at an issue price of £0.267 per ordinary (the "IP Consideration Shares").

·    Payment of a sum of AUD$2,375,000 (c.£1,260,150) that has been made pursuant to the variations of the SPA to facilitate the payment of Capital Gains Tax by BAT in connection with the disposal of Suni in consideration for which Suni agreed:

o  to a AUD$1,250,000 (c.£677,500) reduction in the value of Consideration Shares to be issued as consideration under the SPA from AUD$11,000,000 (c.£5,962,000) to AUD$9,750,000 (c.£5,284,500);

o  to the Company retaining the right to the VAT Refunds due to Suni for historical spends by BAT and amounting to c.AUD$ 1.5 million (c.£810,000).

Assets acquired by the Company

The Acquisition includes the entire equity capital of Suni (with 7,256 out of 241,868,268 of Suni shares in issue held by the Executive Chairman of the Company as nominee on behalf of the Company to satisfy local Mozambique requirements), shareholder debt advanced by BAT to Suni and the Battery Technical Information. Details of the assets acquired are set out below:

·    Mining license over an area of 3,666.88 hectares for the Montepuez Project vested with a JORC 2012 mineral reserves and resources totalling 119.60 million tons with license to build the project to 100,000 tons flake graphite production per annum in 2 stages of 50,000 tons each.

·    All infrastructure and assets on the ground at the construction initiated Montepuez Project including, but not limited to, (i) 100 persons base camp facilities, (ii) the developed construction site for setting up the proposed processing facilities (iii) the well-constructed tailing dam, and (iv) a mobile crusher unit with capacity sufficient for the first 50,000 tons plant as per the Montepuez Graphite Implementation Project document.

·    Mining license over an area of 1543.08 hectares for the Balama Central Project vested with a JORC 2012 mineral reserves and resources totalling 32.9 million tons and license to build the project to 58,000 tons flake graphite production per annum.

·    Fixed deposits with NED Bank pledged for the issue of Bank Guarantee in connection with the Projects amounting to >c.£2 million including cash remitted to Suni by the Company through BAT amounting c.£970,000 to cover the bank guarantee issued for the Balama Central Project.

·    All historical technical information on the projects.

·    Rights to the VAT Refunds.

Rationale for the Acquisition

The Montepuez and Balama Central Projects are strong additions to the Company's existing portfolio of graphite assets. They are advanced stage projects in a jurisdiction and location that hosts one of the largest flake graphite producing projects in the world and are complimentary to the Company's existing portfolio of graphite assets in Madagascar. Some of the key takeaways for the Company from this acquisition are:

·    The reserves and resources across the projects are world-class with more than 12 million tons of contained graphite and remain open across strike and depth; and

·    The projects are fully permitted for c.158,000 tons per annum flake graphite production capacity creation which can be enhanced further if the Company so desires; and

·    The deposits complement the Company's large flake graphite products from Madagascar in as much as the Madagascan flakes would continue to fetch premium prices from applications that necessarily need these whereas the smaller flakes from Mozambique Projects fit the best for the energy storage sector.

·    The average grade of >8.5% is circa two times of that in the Company's Madagascan projects and the Company is of the view that it will far outstrip the process cost disadvantages over saprolite Madagascan deposits; and

·    Post completion of Feasibility Studies, BAT initiated the construction of facilities for a 50,000 tons per annum flake graphite production first module and also acquired certain equipment for the Montepuez Project, which are well maintained and fit for purpose as the Company embarks on the journey of building the project.

·    According to estimates made by the Company, it is likely to cost no less than £10 million to execute the quantum of construction work completed at and to procure the equipment received in Montepuez, if executed now.

The Company reiterates that the addition of these Projects will be instrumental in providing the Company with the required resources to achieve its ambition of providing 8% of the estimated global flake graphite demand of 5 million tons per annum by 2030.

Admission of the Tranche 1 Consideration Shares and IP Consideration shares

It is expected that admission of the Tranche 1 Consideration Shares and IP Consideration Shares to the Standard Segment of the Official List of the Financial Conduct Authority ("FCA") and to trading on the Main Market of the London Stock Exchange, is expected to become effective on or about 8.00 a.m. on 6 April 2023 ("Admission").

Following the issue of Tranche 1 Consideration Shares and the IP Consideration Shares the Company's issued share capital will comprise 108,489,990 ordinary shares of £0.025 each. The above figure may be used by shareholders as the denominator for the calculations by which they will determine whether they are required to notify their interest in, or a change to their interest in, the Company under the Financial Conduct Authority's Disclosure and Transparency Rule.

Shishir Poddar, Executive Chairman of Tirupati Graphite, commented:

"We are delighted to announce the completion of the acquisition of Suni Resources. This strategic acquisition will see us materially strengthen our existing portfolio through the addition of two world-class graphite assets located within one of the largest commercially operating global flake graphite projects.

"As the global need for critical minerals increases, the flake graphite market is forecast to reach 5 million tonnes per annum of new demand by 2030. This acquisition positions Tirupati at the forefront of the market and enables us to accelerate the production of these materials essential to the energy transition.

"Importantly, through acquiring the Balama Central and Montepuez projects in Mozambique, we are diversifying our locations, providing access to a new region as well as providing buyers with an additional source of graphite outside of China, where global supply is currently heavily concentrated.

"Moving forward, our focus will be on optimising processing technology, flow sheet and the investment required for the projects, continuing the construction of the first module at Montepuez, and drawing on our decades of expertise and history of building flake graphite projects. As a reminder, TG's capital intensity and operating costs are within the bottom quartile of the industry and the completion of this acquisition further allows TG to robustly engage with the global energy storage markets."

ENDS

For further information, please visit https://www.tirupatigraphite.co.uk/ or contact:

 About Tirupati Graphite

Tirupati Graphite Plc is a specialist flake graphite company, a material vital in the energy transition economy. The Company places a special emphasis on "green" applications, including renewable energy and energy efficiency, energy storage and thermal management and is committed to ensuring its operations are sustainable as well. 

The Company's operations include primary mining and processing in Madagascar, where the Company operates two key projects, Sahamamy and Vatomina; 12,000 tpa installed capacity of high-quality flake graphite concentrate with up to 96% purity is currently being produced and sold to customers globally, planned to increase to 84,000 tpa as per the Company's modular medium-term development plan.