PERTH (miningweekly.com) – ASX-listed junior Jindalee Resources on Tuesday revealed plans to reposition itself as a pure-play US lithium developer by demerging its Australian assets into a separate, standalone vehicle to be listed on the Australian bourse.
The new company’s portfolio will include Jindalee’s extensive landholding in the Widgiemooltha district and the Lake Percy project, which are both highly prospective for nickel, gold and lithium, together with its interest in the Prospect Ridge joint venture in Tasmania.
Jindalee told shareholders that the demerger decision followed completion of a strategic review of its portfolio which concluded that a separation of the Australian assets represented the optimal structure to maximise value for shareholders.
Critically, the demerger will allow Jindalee to focus its efforts exclusively on the acceleration of exploration and development activities at its world-class McDermitt lithium project, one of the largest lithium deposits in the US.
The company recently engaged consultants to commence baseline environment and heritage activities at McDermitt. In addition, following the release of exploration results from the 2021 drill campaign, Jindalee expects to publish an updated mineral resource estimate for McDermitt in the current quarter.
A further drill programme is planned for the second half of the calendar year, with permitting already in place for 28 additional holes.
“The time is right for Jindalee to reposition itself as a pure-play US lithium developer,” said Jindalee chairperson Justin Mannolini.
“The board believes that the favourable political climate in the United States following bi-partisan expressions of support for the development of an integrated domestic lithium-ion battery value chain, coupled with the well-known electric vehicle thematic, create the ideal backdrop for the proposed demerger.
“As one of the largest lithium projects in the US, McDermitt presents a huge array of potential development pathways. Critically, the project is 100% owned and entirely unencumbered by offtake or legacy strategic ownership arrangements, creating a high degree of optionality in a market which is increasingly starved of opportunities to deliver a meaningful volume of lithium credits from a single source in a tier-one jurisdiction.
“We also believe there is tremendous potential in our under-explored West Australian landholding, which will benefit from the renewed focus that will be facilitated by the demerger.”
The demerger will be effected by a distribution of 100% of the new company shares on issue via an in-specie distribution by Jindalee. Eligible Jindalee shareholders will be entitled to receive a pro rata distribution of the new company shares at the record date.
The demerger is subject to final board, regulatory and shareholder approvals. In particular, the company cautions that the admission of the new company to the official list of the ASX is conditional on and subject to ASX’s satisfaction that the new company has a structure and operations suitable for a listed entity and ASX’s absolute discretion.
If approved, the demerger is expected to be completed in the September quarter of 2022.