PERTH (miningweekly.com) – ASX-listed Arizona Lithium has struck a deal to acquire privately held Prairie Lithium, which holds a lithium project in Saskatchewan and a proprietary lithium extraction technology that removes lithium from brine.
Under the terms of the agreement, Arizona Lithium would acquire Prairie Lithium for C$40-million in cash and 500-million of its own shares, giving Prairie shareholders a 15% interest in Arizona Lithium.
Arizona Lithium is seeking approval for an exempt relief application under the Canadian securities law, and once this has been approved, would put the takeover offer to Prairie Lithium shareholders. In the event that the relief is not granted, the two companies would work to amend complete the transaction by alternative arrangement.
Arizona Lithium told shareholders on Wednesday that the acquisition would significantly increase the size of the company’s lithium resource and diversify the type of resource and its geographical location.
Post close the combined entity will have a resource in Arizona, a resource in Saskatchewan and a prospective resource in New Mexico. The acquisition also brings with it a North American based technical management, which includes geologists, engineers, chemists, drilling managers and other technical roles. The Prairie management team will be able to assist in the development of the Big Sandy project, and the Arizona Lithium management team can assist in the development of the Prairie Lithium resource, particularly through the use of the Lithium Research Centre.
“The acquisition of Prairie Lithium is transformational for Arizona Lithium as we continue to advance the company as a leader in lithium development and processing in North America. Prairie’s board and management team have significant experience in lithium processing and technology, which will further bolster Arizona Lithium’s team and expedite the sustainable development of the Big Sandy lithium project in Arizona, through the application of Prairie’s direct lithium extraction (DLE) processing technology expertise,” said Arizona Lithium MD Paul Lloyd.
“The modular, DLE process selectively extracts lithium from brine while rejecting impurities, thereby also providing significant potential benefits to the development of the company’s Lordsburg lithium brine project in New Mexico. Prairie currently operates a pilot plant of its DLE technology in Emerald Park, Saskatchewan. The acquisition strongly complements Arizona Lithium’s strategy of developing a world class Lithium Research Centre in Tempe Arizona, which will function as a technology incubator focussed on the extraction of lithium from a variety of ores and brines. The expectation is for Big Sandy ore, Prairie Lithium brine and other ore bodies to be tested and refined in the Lithium Research Centre.
“The Acquisition will also significantly increase Arizona Lithium’s lithium resources with Prairie’s projects in Saskatchewan, Canada, holding 4.1-million tonnes lithium carbonate equivalent total inferred resources at 111 mg/L lithium with the region being named as the most attractive in Canada for mining investment and number two in the world.”