In a move that could have major implications for the critical minerals sector, Military Metals Corp. (CSE: MILI | OTCQB: MILIF | FSE: QN90) announced today that it intends to adopt a shareholder rights plan, commonly referred to as a “poison pill”, designed to protect investors from creeping takeover bids.
While the company emphasized that the plan isn’t being adopted in response to any current acquisition proposal, the timing is telling. With United States Antimony Corp. (NYSE: UAMY) recently launching a hostile bid for Larvotto Resources, and with growing activity across the North American antimony space, it’s clear the sector is entering a new phase of strategic consolidation.
Why a Rights Plan Matters
Shareholder rights plans are defensive measures that allow existing investors (other than the hostile bidder) to purchase shares at a discount if a party tries to acquire control without board approval. It’s a tool designed to prevent “creeping bids”, gradual accumulations of shares that can lead to control without paying a fair premium.
Military Metals CEO Scott Eldridge said it best:
“We are experiencing unprecedented times in the critical minerals sector. In light of recent hostile takeover attempts, such as the unsolicited bid by US Antimony Corp for Larvotto Resources, our Board believes it is prudent to take proactive measures to protect our shareholders.”
In other words, this is about keeping control in the hands of shareholders, not opportunistic acquirers.
The Bigger Picture: U.S. Antimony Is on the Hunt
The timing of MILI’s defensive move aligns closely with UAMY’s recent expansion plans. United States Antimony, the only operating antimony smelter in North America, recently announced the construction of a new smelting facility in the U.S., with the goal of increasing domestic processing capacity.
But there’s one major problem: they don’t have enough feedstock.
To solve that, UAMY has begun acquiring, or attempting to acquire, companies with advanced-stage antimony deposits and concentrate potential. Their unsolicited bid for Lorvotto Resources, an Australian-listed junior, is the first public example. UAMY’s CEO even admitted they had quietly accumulated a 10% position in Larvotto before the offer went public.
Could Military Metals Be Next?
Military Metals holds highly strategic antimony assets in Nevada, Slovakia, and Nova Scotia, the exact jurisdictions where Western supply chain partners are seeking secure, non-Chinese sources of critical minerals.
And notably, a few weeks ago, $MILIF traded more than 8 million shares in a single week on the U.S. OTCQB market, an unusually large spike in volume for a small-cap explorer.
While there’s no confirmation of who was behind the buying, it wouldn’t be far-fetched to speculate that UAMY or another U.S. industrial player could be quietly building a position ahead of a potential move.
Strategic Fit
The synergies between the two companies are obvious:
- UAMY: Downstream smelter, in need of ore and concentrate.
- MILI: Upstream producer with district-scale antimony projects and room to expand.
A combination would create one of the few vertically integrated Western antimony suppliers, precisely the model the U.S. Department of Defense and Department of Energy are encouraging as part of their strategic stockpiling initiatives.
Final Thoughts
While Military Metals insists the Rights Plan is a “prudent, proactive measure,” the market should take note of what’s happening beneath the surface.
Antimony is now one of the most strategically important, and politically sensitive, critical minerals in the world. With China and Russia controlling the majority of global supply, Western nations are racing to secure domestic and allied sources.
In that context, the idea of a U.S. smelter quietly accumulating shares in a Canadian antimony developer isn’t far-fetched, it’s strategic positioning.
The next few months could bring more than just governance housekeeping. They could mark the beginning of a North American antimony consolidation wave, and Military Metals may be right in the middle of it.
DISCLOSURE: The author did not receive any compensation for publishing this article. The author holds a position in Military Metals and may choose to buy or sell shares of the company at any time without notice. The author does not hold positions in any of the other companies mentioned. While reasonable efforts have been made to ensure the accuracy and reliability of the information provided, readers are encouraged to conduct their own research and seek independent financial advice before making any investment decisions related to the companies discussed.
