Pulsar Helium (AIM: PLSR; TSXV: PLSR; WKN A3EP2C) intends to expand into the US state of Michigan with an acquisition: The company has signed a non-binding letter of intent to acquire 100% of Hybrid Hydrogen Inc. At the core of Hybrid’s portfolio is an approximately 6,742-acre package of mineral rights in the Upper Peninsula region of the US state of Michigan, which relates to non-hydrocarbon gases – and thus particularly helium. The transaction is to be carried out entirely in shares worth $80,000, thereby preserving liquidity for the further development of Pulsar Helium’s Topaz project in the neighboring state of Minnesota.
Pulsar Helium: Key Terms of the Planned Transaction
The term sheet provides for the acquisition of all outstanding shares of Hybrid in exchange for newly issued common shares of Pulsar Helium. The final number of shares will be determined prior to closing based on an agreed valuation mechanism (including VWAP). The shares issued as consideration are subject to the customary four-month-and-one-day hold period in Canada. Additionally, a 60-day exclusivity period has been agreed upon; a fee of $20,000 is payable for this to finalize the definitive contractual documents and complete due diligence.
As is customary with letters of intent, the term sheet is non-binding – with the exception of confidentiality and exclusivity. The closing is subject to a definitive purchase agreement, satisfactory due diligence, and the necessary approvals, including from the TSX Venture Exchange (TSXV). (Corporate Governance Note: Neil Herbert, Director of Pulsar Helium, is a minority shareholder of Hybrid and did not participate in the discussions and decisions regarding the planned transaction.)
Geological Rationale: Analogies to Topaz in Minnesota
The mineral rights held by Hybrid for non-hydrocarbon gases are located in a geological environment familiar to Pulsar Helium from Minnesota: an ancient sedimentary basin above crystalline basement rock. Helium is formed from the decay of uranium and thorium in archaic granites, migrates upwards through fractures and pore spaces, and can accumulate in permeable sediments beneath dense, sealing layers. Pulsar Helium analyzes and develops precisely this interplay of source, migration pathways, and traps at the Topaz project.
The company therefore sees an opportunity to transfer its Topaz expertise – from mapping migration pathways and structures to identifying effective seals – to the Upper Peninsula. This approach is supported by Michigan’s established regulatory and infrastructure environment for gas projects, which is increasingly being applied to helium exploration. This provides Pulsar Helium with a strategically consistent expansion of its US portfolio into a geologically familiar region.
Assessment: Early Stage, Conservative Structure, Clear Priorities
Hybrid is in an early exploration stage, currently generates no revenue, and does not yet have any proven reserves or defined helium resources. Accordingly, Pulsar Helium does not expect any material effects in the short term. In the medium to long term, however, successful work could unlock additional potential. The deal’s execution exclusively in shares serves to secure cash for the Topaz project in Minnesota, which remains a priority and which Pulsar Helium is actively advancing.
The planned acquisition fits into the company’s strategy to broaden its existing base and expand into geologically analogous areas. At the same time, Pulsar Helium adheres to a disciplined use of resources: only after completing due diligence and obtaining approvals would the land package be transferred into the company’s exploration pipeline.
Next Steps for Pulsar Helium
During the 60-day exclusivity period, Pulsar Helium is working on the definitive contractual documentation, regulatory filings, and technical review of the Michigan property. If successful, initial work packages – such as data evaluation, structural mapping, and the planning of an initial drilling or testing program – could form the basis for target prioritization.
Conclusion: With the planned, share-based acquisition of Hybrid’s mineral rights in Michigan, Pulsar Helium continues its growth strategy: a cost-efficient portfolio expansion in a geologically familiar province, flanked by a clear focus on the flagship Topaz project. Whether the new land package can contribute to the resource base in the future will depend on the results of the upcoming technical reviews and follow-up measures.
