International Lithium Corporation (ILC) has announced that it will sell the remaining 8.58% stake it has in Litio Miñera Argentina to Ganfeng Lithium.
Litio Miñera Argentina owns the Mariana lithium salar project, in Argentina.
ILC will also sell the right it had to acquire a further 10% in the Mariana project.
ILC will use about $3-million of the $13-million sale to repay another Ganfeng Lithium subsidiary, which relates to an exploration loan, and some of the funds for exploration at the Raleigh Lake lithium and rubidium project, in Canada.
The company explains that the decision to sell the Mariana shareholding came about as Ganfeng intended to invest more than $570-million on the project over the next three years, and investment from ILC’s side would have diluted value for existing shareholders on other projects.
As the 91.4% owner already, Ganfeng was the most logical buyer provided that the price was right.
ILC CEO John Wisbey states this transaction puts the company in the strongest financial position it has been in since its formation and will enable the building of a stronger company in the next few years.
“It is not every day that companies sell a single asset for 80% of their market capitalisation and, given the dynamics of the capital investment required at Mariana and the workings of our joint venture agreement with Ganfeng, the board and I consider the transaction to be very much in the interests of ILC’s shareholders.”