European Lithium Ltd (ASX:EUR, OTCQB:EULIF) and SPAC Sizzle Acquisition Corp (NASDAQ:SZZL) are on track to complete their business combination transaction and NASDAQ listing by the second quarter of 2023.
In October 2022, EUR and Sizzle signed an agreement pursuant to which EUR is combining its wholly owned Wolfsberg Lithium Project in Austria with Sizzle via a newly-formed lithium exploration and development company named “Critical Metals Corp” which is expected to be listed on Nasdaq.
Upon completion of the transaction, EUR expects Critical Metals to be one of the leading lithium mining companies on the Nasdaq under the symbol ‘CRML’, with EUR remaining the largest shareholder in Critical Metals as it continues its listing on the ASX.
SEC review process
In December 2022, the F-4 Registration Statement of Critical Metals Corp was filed with the U.S. Securities and Exchange Commission (SEC) in connection with the transaction.
Closing of the transaction is subject to a number of conditions precedents including approval of Sizzle shareholders, the declaration of the F-4 as effective by the SEC and other customary requirements.
It is anticipated that the transaction will complete in the second quarter of 2023.
EUR chairman Tony Sage said: “We anticipate the SEC review process will conclude in the first half of 2023.
“Once the F-4 is declared effective the board of Sizzle will convene a shareholder meeting to approve the transaction.
“We will work to finalise the NASDAQ listing process shortly thereafter.”
Ukraine projects acquisition
In 2021, EUR signed a deal to acquire two Ukrainian lithium projects, Shevchenkivske and Dobra, through an agreement to acquire European Lithium Ukraine LLC (formerly Petro Consulting LLC) from Millstone and Company Global DW LLC.
Under the terms of the acquisition, Millstone agreed to invest A$20 million in EUR of which A$5 million has completed and A$15 million being conditional upon completion of the acquisition of European Lithium Ukraine by EUR.
EUR has now advised that, because of Russia’s invasion of Ukraine, EUR and Millstone have agreed to vary the acquisition terms as set out below.
Acquisition terms
1. The acquisition of European Lithium Ukraine is, in addition to the conditions set out in EUR’s announcement released 4 November 2021, subject to:
a. Martial law having been cancelled or terminated in accordance with Ukraine law; and
b. European Lithium Ukraine commencing drilling on the Dobra Project.
2. The consideration to be paid is as follows:
a. Upon the licence for the Dobra Project being granted, 7 million EUR shares at an issue price of $0.10 per share;
b. At completion, EUR shares with a value of A$17.3 million at an issue price of the greater of 80% of the then 20 day VWAP and $0.095, and A$45 million of performance shares; and
c. Upon the grant of the Shevchenkivske Project, EUR shares with a value of A$2 million at an issue price of the greater of 80% of the then 20 day VWAP and $0.095, and A$5 million of performance shares.
3. The end date to complete the acquisition is extended to 2 November 2025.
Securing local supply of lithium
On the changes to the Ukraine projects acquisition, Tony Sage commented: “The burgeoning energy transition requires critical raw materials, the EU has identified lithium as one of these and securing local supply as essential to meeting green energy goals.
“EUR identified the huge potential in the Dobra and Shevchenkivske Projects before our plans were impacted by the current conflict.
“Once the conflict is over and Ukraine look to the reconstruction process, we believe the world will show its support with billions of dollars of investment and much needed economic activity.
“EUR is in a unique position to recommence the exploration and development plans for these important projects.”