Mr. William Dawes reports

MKANGO MAGNETIC MATERIALS LIMITED ANNOUNCES ACQUISITION OF 10% INTEREST IN HYPROMAG GERMANY

HyProMag Ltd. (HyProMag U.K.), a wholly owned subsidiary of Mkango Magnetic Materials Ltd.'s Maginito Ltd., has entered into an agreement with Prof. Carlo Burkhardt to acquire his 10-per-cent interest in HyProMag GmbH (HyProMag Germany). On completion of the acquisition, HyProMag Germany will be wholly owned by HyProMag U.K.

HyProMag Germany is currently commissioning a rare earth magnet recycling and manufacturing plant in Pforzheim and was recently selected as a strategic project under the European Union Critical Raw Materials Act.

The acquisition follows the conversion into equity of the convertible loan made to HyProMag Germany, which became effective on Oct. 19, 2026, on registration of the related capital increase in the German commercial register. As a result, HyProMag U.K. now holds 90 per cent of HyProMag Germany with the balance to be acquired from Prof. Burkhardt pursuant to the acquisition.

The total consideration for the acquisition is 1.06 million British pounds. Of this, 757,900 British pounds will be satisfied on completion by the issue to Prof. Burkhardt of 2,569,152 new common shares of Mkango at a price of 29.5 pence per share, being the closing price of Mkango's shares on the AIM (Alternative Investment Market) on Oct. 27, 2026, the business day before this announcement. The balance of 302,100 British pounds is payable in cash on commissioning of HyProMag Germany's plant in Pforzheim and in any event by Dec. 31, 2026. The consideration shares will be subject to a contractual lock-up of six months from the date of issue.

The acquisition is being financed by Maginito's shareholders in proportion to their interests in Maginito. Cotec Holdings Corp., which holds 20.6 per cent of Maginito, will contribute 218,360 British pounds in cash, and Mkango, which holds 79.4 per cent, will contribute the consideration shares and 83,740 British pounds in cash. On completion, Mkango's effective interest in HyProMag Germany, held through Maginito, will increase from 71.5 per cent to 79.4 per cent.

Prof. Burkhardt, a founding shareholder of HyProMag Germany, will continue to work with the Mkango group as a consultant following completion.

Completion of the acquisition is subject to final acceptance of the TSX Venture Exchange and execution of a notarized share transfer agreement in Germany. A further announcement will be made on completion.

Will Dawes, chief executive officer of Mkango, commented: "Carlo has been central to HyProMag Germany since its formation and to developing the Pforzheim plant in conjunction with the excellent team on the ground. Taking HyProMag Germany into full ownership simplifies the group structure as we scale up short-loop rare earth magnet recycling and manufacturing in Germany, and we are delighted that Carlo will continue to work with the group following the transaction."

Prof. Burkhardt commented: "I am proud of what the team has achieved in Pforzheim. Taking my consideration in Mkango shares keeps me invested in the group's success, and I look forward to continuing to support HyProMag and the wider Mkango group."

Related party transaction

Prof. Burkhardt holds 10 per cent of HyProMag Germany, a subsidiary of the company, and is therefore a related party of the company for the purposes of the AIM Rules for Companies. The acquisition is accordingly a related party transaction under AIM Rule 13. The directors of the company, all of whom are independent of the acquisition, consider, having consulted with SP Angel Corporate Finance LLP, the company's nominated adviser, that the terms of the acquisition are fair and reasonable insofar as the company's shareholders are concerned.

Admission and total voting rights

Application will be made for the 2,569,152 consideration shares to be admitted to trading on the AIM. Admission is expected to take place on completion of the acquisition, the date of which will be announced. The consideration shares will rank pari passu with the company's existing common shares.

Following admission, the company's issued share capital is expected to comprise 392,722,770 common shares, each with one voting right. The company holds no shares in treasury.

About Mkango Magnetic Materials Ltd.

Mkango is listed on the AIM and the TSX-V. Mkango's corporate strategy is to become a market leader in the production of recycled rare earth magnets, alloys and oxides, through its interest in Maginito, which is owned 79.4 per cent by Mkango and 20.6 per cent by Cotec Holdings, and the Remloy business acquired by its wholly owned German subsidiary, to develop new sustainable sources of neodymium, praseodymium, dysprosium and terbium to supply accelerating demand from electric vehicles, wind turbines and other clean energy technologies.

Maginito holds a 100-per-cent interest in HyProMag Ltd. and a 90-per-cent indirect interest in HyProMag GmbH, focused on short-loop rare earth magnet recycling and manufacturing in the United Kingdom and Germany, respectively, and a 100-per-cent interest in Mkango Rare Earths U.K. Ltd., focused on long-loop rare earth magnet recycling in the United Kingdom through a chemical processing route.

HyProMag GmbH has been selected as a strategic project under the European Union Critical Raw Materials Act.

Maginito and Cotec are also expanding HPMS (hydrogen processing of magnet scrap) recycling technology into the United States through the 50/50-owned HyProMag USA joint venture company.

Remloy has developed a plant in Bitterfeld, Germany, which recycles end-of-life rare earth magnets through a melting process (medium-loop rare earth magnet recycling) to produce neodymium-iron-boron (NdFeB) alloy powders for the bonded and hot deformed magnet markets, complementary to HyProMag's short-loop recycling process (to produce sintered magnets) and Mkango U.K.'s long-loop recycling process (to produce mixed rare earth carbonates and oxides).

Mkango currently owns 100 per cent of the advanced-stage Songwe Hill rare earths project in Malawi and the proposed Pulawy rare earths separation plant in Poland. On grant of the large-scale mining licence, the government of Malawi may elect to take a free 10-per-cent interest in the entity holding that licence. Both the Songwe and Pulawy projects have been selected as strategic projects under the European Union Critical Raw Materials Act, as has HyProMag GmbH. Songwe has also received development funding from the U.S. International Development Finance Corporation (DFC), the U.S. government's development finance institution, securing $4.6-million (U.S.) in reimbursable funding for front-end engineering and design. MKAR has signed a business combination agreement with CPTK to list the Songwe Hill and Pulawy rare earths projects on Nasdaq through a special-purpose acquisition company (SPAC) merger under the name Mkango Rare Earths.

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