The price of vanadium has soared on predictions that the metal will be an electrolyte in batteries used for electricity storage at power stations

Bushveld Minerals Limited (LON:BMN) has completed the acquisition of 55% of Bushveld Vametco it doesn’t already own for an initial US$11.1mln in cash and shares.

This in turn will give it a 59.1% stake in South Africa's Vametco vanadium mine and processing operations compared with 26.6% previously.

The deal has completed the miner’s transition into a vanadium producer. The price of vanadium has soared on predictions that the metal will be an electrolyte in batteries used for electricity storage at power stations.

Vametco has 3.5% share of the global vanadium market currently but there is potential to expand production to more than 5,000 metric tonnes of the metal (mtV) per annum over the next three years.

In the three months to September, production at Vametco was running at an annual rate of about 3,000 tonnes per year.

A “delighted” chief  executive Fortune Mojapelo said: “Vametco has, to date, illustrated its strong cash generation capability and, with the expansion initiatives underway, the drive towards a lower cost base which, in a rising vanadium price environment, ensures the transaction is value accretive to our shareholders.

 “We go into 2018 in a strong position and look forward to the future with confidence."

Newly issued stock in the enlarged group began trading earlier Thursday. At 8.15am, they were flat at 8.73p each.

• [Editor:Wang Linyan]