PERTH (miningweekly.com) – Lithium miner Galaxy Resources will cease share trading on Monday as its merger with fellow-listed Orocobre becomes effective.
The two companies in April struck a merger of equals agreement to create the fifth largest global lithium chemicals company.
Under the terms of the proposed A$4-billion merger, Galaxy shareholders will receive 0.569 Orocobre shares for each of the shares they hold, with Orocobre shareholders to own 54.2% of the fully diluted share capital of the combined entity, while Galaxy shareholders will own the remaining 45.8%.
The Supreme Court of Western Australia on Friday made orders approving the proposed merger, after Galaxy shareholders also backed the proposal.
Galaxy on Monday said that the merger would be implemented on August 25, and new Orocobre shares would start trading on August 26.
Galaxy on Monday also reported revenue of some A$38.6-million for the half-year ended June, up 66% from the A$23.2-million reported in the same period last year, as the company swung to a net profit of A$64.2-million in the same period, compared with a net loss of A$22.1-million.
Concentrate production in the half-year to June reached 109 909 t, compared with the 45 248 t produced in the previous corresponding period, with concentrate sales up from 58 541 t to 78 416 t in the same period, as sales prices increased from $398/t to $453/t.
The merger with Orocobre is expected to create a top five global lithium chemicals company with assets across a diversified geography, lithium sources and end products, and will combine two complementary, large scale tier-one assets in the form of Orocobre’s Olaroz mine, in Argentina, and Galaxy’s Mt Cattlin mine, in Western Australia.
The combine company will also have a significant portfolio of upstream and downstream growth projects, with the growth pipeline evenly balanced between production optimisation, construction, advanced projects, brownfield expansions and early-stage projects.