The Champion Iron Ltd (ASX: CIA) share price is racing higher in late-afternoon trade. This comes after the company announced the completed acquisition of the Kamistiatusset iron ore project (Kami Project). At the time of writing, the iron ore miner's shares are swapping hands for $5.98, up 6.03%.
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What's driving the Champion Iron share price higher?
Investors are picking up Champion Iron shares in anticipation of the company's exciting future prospects.
According to its release, Champion Iron advised it has formally finalised the acquisition of the Kami Project.
The sale involves a cash consideration of $15 million from Champion Iron to former Kami Project owners, Alderon Iron Ore. In addition, roughly $19.4 million of secured debt accumulated from Alderon has been repaid.
As part of the agreement, Champion Iron will also receive an additional 8 million tonnes annually of port capacity in Sept-Isles, Que. Currently, the company sends its Bloom Lake iron ore concentrate to the same port.
Located near Labrador City, Newfoundland and Labrador in Canada, the Kami Project is a high-grade open-pit iron ore mine. Alderon Iron Ore also conducted a feasibility study in September 2018. Additionally, Champion Iron is seeking to revise the project's scope and update its feasibility in the near term.
Champion Iron CEO David Cataford commented:
This acquisition adds a large scale and highly prospective project to our portfolio. In addition, by securing additional port capacity, this further de-risks our Bloom Lake Phase II expansion project, which is currently under construction. In keeping with our track record of diligently evaluating and transforming opportunities into valuable assets, we look forward to revising the Kami Project's scope and updating its previously completed feasibility study, along with its potential to positively impact local communities and the regional economy, which is and has always been a key goal for our Company.
Over the past 12 months, the Champion Iron share price has gained over 200% and is up 25% year-to-date.
