Lithium Americas Corp (TSX:LAC, NYSE:LAC) announced that it has agreed to acquire all of the issued and outstanding common shares of Arena Minerals Inc that it does not already own in an all-stock transaction valued at C$311 million.
The lithium projects developer said shareholders of Arena Minerals will receive 0.0226 of a Lithium Americas common share for each Arena share held, which would result in Arena investors owning about 5.7% of Lithium Americas.
“This transaction will consolidate the highly prospective Pastos Grandes basin, and creates an exciting opportunity for Lithium Americas, a Canadian incorporated and headquartered company, to add incremental growth in one of the most important lithium producing regions in the world,” Lithium Americas CEO Jonathan Evans said in a statement.
“The significant synergies between our two projects and a better understanding of the basin will enable us to advance development planning and maximize our growth pipeline in Argentina,” Evans added.
Lithium Americas noted the timing of the transaction aligns with the company’s previously-announced plan to separate into two public companies in 2023, with significant project development activities expected at both businesses early next year.
It added that the takeover agreement implies a purchase price of C$0.67 per Arena Minerals share, which is an approximately 28% premium to Arena’s closing price on December 19, 2022.
As well, Lithium Americas said the deal unlocks development opportunities in Argentina’s Pastos Grandes basin by combining the Pastos Grandes and Sal de la Puna projects, while the all-stock transaction conserves the company’s US$392 million in cash and short-term bank deposits as of September 30, 2022.
Contact Sean at sean@proactiveinvestors.com