Zijin Mining to acquire Neo Lithium Corp. as part of a cash offer
All monetary amounts are expressed in Canadian dollars, unless otherwise indicated.
Zijin Mining Group Co., Ltd. (“Zijin”) (SSE: 601899) (SEHK: 2899) and Neo Lithium Corp. (“Neo Lithium” or the “Company”) (TSXV: NLC) (OTCQX: NTTHF) (FSE: NE2) is pleased to announce that it has entered into a definitive agreement (the “Arrangement Agreement”) , pursuant to which Zijin has agreed to acquire all of the outstanding shares of Neo Lithium (the “Transaction”) at a price of Cdn $ 6.50 per share (the “Offer Price”) in cash. The offer price represents a premium of approximately 36% over the 20-day volume weighted average price (“VWAP”) of Neo Lithium as of October 8, 2021 on the TSX Venture Exchange (“TSXV”) . The total cash consideration for all outstanding equity of Neo Lithium is approximately C $ 960 million.
Waldo A. Perez , President and CEO of Neo Lithium, said:
“After a thorough strategic process, we are very pleased to provide our shareholders with this premium all-cash offer from a leading global mining company. This is the result of the collective work of our first lithium brine exploration team, from the initial discovery in late 2015 to the definition of one of the largest and richest lithium brine deposits in the world, and resulting in this premium offering in just six years. . We believe that now is the time for our project to move into the construction and production phases with Zijin, a proven leader in developing assets responsibly while respecting the interests of employees, communities and communities. local authorities.
Chen Jinghe, Chairman of Zijin, said:
“Neo Lithium’s 3Q lithium brine project in Catamarca, Argentina is one of the largest and highest quality projects of its kind in the world. We would like to express our great respect for the management and professional team who successfully discovered and explored this project. The 3Q project represents an important addition to the growing composition of Zijin’s global assets and it is a good choice for Zijin to enter the field of new energy minerals. Thanks to the efforts and contribution of the professional team at the start of the project, we are confident that with the strong financial resources and mining know-how of Zijin, we will develop this excellent asset to make it one of the main mines. of lithium carbonate in the world. In line with Zijin’s co-development aspirations, we will continue to work closely with local communities and government authorities so that all relevant stakeholders can benefit from the successful development of the project ”.
Zijin undertakes to retain the current management and professional team of LIEX SA, the local operating subsidiary of Neo Lithium, as well as to contribute to the economic and social developments of the province of Catamarca, Argentina , as he moves forward to advance the development of the 3Q project.
Benefits for Neo Lithium shareholders
- Immediate and significant premium of around 36% at the 20-day VWAP on the TSXV
- All cash offer not subject to a financing condition
- Strong certainty of deal with a highly credible and leading global mining company as a buyer
- Voting support agreements entered into with all directors and senior officers of Neo Lithium who hold shares
- Eliminate future risks of dilution, raw materials, construction, production and execution with the next phase of the 3T project
summary of transactions
The transaction will be carried out in accordance with a plan of arrangement under the terms of the Business Corporations Act ( Ontario ). The Transaction will be subject to the approval of at least 66% of the votes cast by the shareholders. In addition to shareholder approval, the Transaction is also subject to obtaining certain governmental, regulatory, judicial and stock market approvals, including the approval of the competent authorities in the People’s Republic of China and approval of the Investment Canada Act, and other closing conditions customary in transactions of this nature.
The Arrangement Agreement includes, among other things, a customary non-solicitation covenant by Neo Lithium (including fiduciary arrangements) and a right for Zijin to match any competing offer that constitutes a superior offer. In certain circumstances, Zijin would be entitled to a $ 35 million termination fees and Neo Lithium would be entitled to a $ 35 million reverse termination fee.
Recommendations of the Neo Lithium Board of Directors
The Transaction has been unanimously approved by the board of directors of Neo Lithium following the unanimous recommendation of a special committee of independent directors of Neo Lithium (the ” Special committee “). Valeurs Mobilières Cormark has provided an opinion to the board of directors of Neo Lithium and to the special committee, indicating that, on the basis and subject to the assumptions, limitations and reservations set out therein, the consideration offered to the shareholders of Neo Lithium in connection with the transaction is fair, from a financial point of view, to the shareholders of Neo Lithium. Cormark Securities’ fairness opinion has been provided on a fixed fee basis and does not depend on of the result of the operation.
Full details of the transaction will be included in the management information circular of Neo Lithium, which is expected to be mailed to shareholders in November 2021 with the shareholders’ meeting which should take place in december 2021 . Shareholders are urged to read the information circular as soon as it becomes available as it will contain additional important information regarding the Transaction. The Arrangement Agreement will also be filed on SEDAR. The Transaction is expected to be finalized in the first half of 2022.
Advisors and advice
Paradigm Capital acts as financial advisor to Zijin and Torys LLP acts as legal advisor to Zijin.
BofA Securities acts as financial advisor to Neo Lithium. Cormark Securities has provided an independent fairness opinion to the Neo Lithium Board of Directors and to the Special Committee. Fasken Martineau DuMoulin LLP acts as legal counsel to Neo Lithium and to the special committee.
About Neo Lithium Corp.
Neo Lithium Corp. quickly became a leading name in lithium brine development thanks to its high quality 3Q project and experienced team. Neo Lithium is rapidly advancing its 100% owned 3Q project – a unique complex of high-carbon lithium brine lakes and salars. Latin America “Lithium triangle”.
The 3Q project is located in the province of Catamarca, the largest lithium production area in Argentina covering around 35,000 ha including a salt complex of around 16,000 ha.
Additional information regarding Neo Lithium Corp. are available on SEDAR at www.sedar.com under the Company’s profile and on its website at www.neolithium.ca, including various photos of work in progress on the project.
Formed in 1993 and based in Fujian, China , Zijin is one of the largest mining companies in China as well as one of the world’s leading producers of gold and copper. It manages a large portfolio, consisting primarily of gold, copper, zinc and other metals through investments in China and twelve overseas countries across Europe , Central Asia , Africa , Oceania and South America . Listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange, Zijin has a market capitalization of approximately 40 billion US dollars .
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this press release.
Cautions Regarding Forward-Looking Statements
Forward-Looking Statements – Certain information contained in this press release may contain forward-looking statements. These statements include, without limitation, statements regarding the benefits of the transaction to the shareholders of the Company, the expected date of the meeting and the sending of the information circular regarding the meeting, the timing the completion of the operation and the receipt of court approvals, expectations regarding how Zijin will continue to operate and benefit the region, advancing the 3Q project, the economic effect of the 3Q project and plans and objectives future of the Company and of Zijin. Generally, forward-looking statements can be identified by the use of words such as “plans”, “expects” or “is expected”, “expected”, “estimates”, “intentions”, “anticipates”, “Believes” or variations of such words and expressions, or statements that certain actions, events or results “may”, “may”, “could”, “would”, “should”, “could” or “will”, occur or negative connotations of it. These forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the control of the Company, which could cause the actual results, performance or achievements of the Company and / or Zijin to differ materially from future results. , performances or achievements expressed or implied by such statements. These risks include, without limitation, risks associated with obtaining regulatory and judicial approvals for the Transaction, political and regulatory risks associated with mining and exploration activities, including environmental regulations, risks and uncertainties. related to the interpretation of drilling and sampling results, risks associated with the uncertainty of estimated costs and delays and the potential for delays, unforeseen costs and expenses, risks associated with price fluctuations metals, lithium products market and other risks and uncertainties relating to the outlook, properties and business of the Company detailed elsewhere in the disclosure records. Although the Company believes that its expectations are based on reasonable assumptions and that it has attempted to identify material factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, d Other factors that may lead to actions, events or results should not be those anticipated, estimated or predicted and one should not place undue reliance on forward-looking statements.
SOURCE Neo Lithium Corp.
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