Atlas Metals’ £1 billion reverse takeover of UPSA: what’s going on and why it matters
Atlas Metals Group has signed a conditional Share Purchase Agreement to acquire Universal Pozzolanic Silica Alumina Ltd (UPSA) in an all-share deal priced at £1 billion. If it completes, this is a full-blooded reverse takeover under the UK Listing Rules, with UPSA’s vendors set to hold 97% of the enlarged company and existing Atlas shareholders just 3% on an assumed fully diluted basis.
UPSA owns the licence to one of the world’s largest reserves of pozzolanic silica alumina (PSA) – a key ingredient in “green concrete”. With concrete responsible for around 8% of global CO₂ emissions, Atlas is positioning itself squarely in the sustainability lane. The deal remains conditional on due diligence, shareholder approvals, FCA approvals and readmission to the Main Market.
Deal terms at a glance
| Purchase price | £1 billion (all-share) |
| Consideration structure | New Atlas shares issued so that UPSA vendors own 97% and existing Atlas shareholders own 3% of the enlarged, assumed fully diluted share capital |
| Free float requirement | More than 10% held in public hands on readmission (may include additional new shares if funds are raised) |
| Listing and trading | Re-admission to the FCA’s Official List (equity shares – commercial companies) and the London Stock Exchange Main Market |
| Deal classification | Reverse takeover (exceeds 100% on UK Listing Rules class tests) |
| Status | Conditional; no certainty of completion |
UPSA’s asset: PSA for green concrete, anchored by Warialda Quarry
UPSA has the commercialisation rights over a substantial PSA reserve in Australia, the Warialda Quarry in New South Wales. Its extraction partner, Claystone International Pty Ltd (controlled by William Clift), holds 99 years of extraction rights for 250 million tonnes. The big pitch here is sustainability: PSA is described as a core constituent of green concrete, and Atlas notes growing interest from major cement and concrete players, with potential use across private and government infrastructure globally.
To support the transaction, SLR Consulting Australia has completed a Competent Person’s Report (CPR) on Warialda. The CPR is available here: SLR CPR (RNS PDF).
What the CPR says: scale, category and value
- Location: ~12 km south of Warialda, NSW.
- Resource estimation (desktop model): Inferred Resource of 160.68 million tonnes, comprising 33.27 million tonnes of sand and 127.41 million tonnes of pozzolanic sandstone.
- Financial model: Assuming material is proven from the current inferred category, the Net Present Value (NPV) is A$3.304 billion (approximately £1.62 billion), using a discounted cash flow method over 25 years and including a terminal value in year 25. Detailed assumptions are in the CPR.
Two points to separate clearly. First, the resource cited is Inferred – the lowest-confidence category. The CPR explicitly assumes the material is proven up from that category before the NPV bites. Second, the partner’s 99-year extraction rights refer to 250 million tonnes, while the CPR’s modelled Inferred Resource is 160.68 million tonnes. These are distinct data points from different lenses (rights versus current resource estimate).
Shareholder impact: 97/3 split and a change of control
The deal would issue new Atlas shares so that UPSA’s vendors own 97% of the enlarged company and current Atlas shareholders own 3% (on the basis stated). That is heavy dilution, and control of the company will pass to the vendors. The company confirms this is a reverse takeover because it exceeds 100% on the FCA’s class tests and will result in changes to the board and voting control.
There is also a free float requirement: more than 10% must be held in public hands on readmission. The RNS allows for issuing additional new shares to raise further funds, which could help satisfy that free float threshold. The price per Consideration Share is not disclosed; it will be set by reference to the £1 billion purchase price and the number of shares to achieve the 97/3 split.
Approvals and next steps: what needs to happen
- Completion of due diligence and regulatory approvals.
- Atlas shareholder approvals at a general meeting, including a waiver resolution for Rule 9 of the Takeover Code related to the resultant controlling shareholding, and share capital authorities to complete the deal.
- Publication of a prospectus, FCA eligibility approvals for the enlarged group, and readmission to the Official List and LSE Main Market.
- Further announcements to follow; no timeline disclosed.
CEO’s pitch: “transformational” and aligned with net zero
CEO Christopher Chadwick says the transaction is anticipated to transform Atlas into a “£1 billion plus market cap company” and deliver substantial value, backed by a world-class PSA reserve and strong interest from global cement and concrete players. Strategically, the sustainability angle is clear: targeting concrete’s carbon footprint with a material positioned as a core constituent of green concrete.
My take: the bull case and the bear case
Reasons to be optimistic
- Strategic fit: Exposure to a large PSA opportunity tied to decarbonising construction – a global, long-duration theme.
- Scale: A 160.68 million tonne Inferred Resource is substantial, with a partner holding long-dated extraction rights (99 years for 250 million tonnes).
- Economics headline: An NPV of A$3.304 billion (approximately £1.62 billion) versus a £1 billion share-based purchase price looks attractive at face value, if (and it’s a big if) the Inferred material is proven and the CPR assumptions hold.
- Market interest: The company cites interest from major cement and concrete companies, plus potential deployment into government infrastructure projects.
Risks and open questions
- Completion risk: The deal is conditional. There is no certainty it will complete.
- Dilution and control: Existing shareholders fall to 3% on the stated basis. Control passes to the vendors; governance and strategy will shift.
- Resource confidence: The CPR’s resource is Inferred. The NPV explicitly assumes material is proven from that category. Upgrading resources can take time and capital.
- Execution and funding: The RNS does not disclose development capex, operating cost assumptions, or a timeline to commercial revenues. Additional equity may be issued to meet the free float or raise funds.
- Regulatory and listing hurdles: Prospectus and FCA approvals are still to come, alongside shareholder votes including the Rule 9 waiver.
What to watch for next
- Prospectus publication: This should set out detailed economics, development plans, timing and capital requirements.
- Notice of General Meeting: Wording of the Rule 9 waiver resolution and share authority requests will matter.
- Any fundraise alongside readmission: Quantum and pricing will influence the free float and valuation optics.
- Further CPR detail: The specific assumptions underpinning the A$3.304 billion NPV, including sensitivities and the pathway to upgrade Inferred resources.
Bottom line: this is a bold pivot towards a large, sustainability-linked materials play. On paper, the asset scale and modelled value are compelling; in practice, the dilution, conditionality and early-stage resource status mean investors need the prospectus detail to judge risk-reward properly. For now, eyes on the approvals timetable and the fine print that follows.
