Atlantic Lithium Ltd (AIM:ALL, ASX:A11, OTCID:ALLIF) said it has ended exclusive discussions over a potential change-of-control deal, opting to wait for what it sees as a key de-risking catalyst in Ghana, ratification of the Mining Lease for its Ewoyaa Lithium Project.
The AIM- and ASX-listed developer noted that it had received a conditional, non-binding indicative proposal to acquire 100% of the company via a scheme of arrangement.
The board appointed advisers, granted exclusivity and opened due diligence with the prospective bidder, but said talks have now ceased without any agreement being reached. Shareholders do not need to take any action, it added.
"With the best interests of shareholders front of mind, the board determined that the proposal did not fully encompass the true potential of the company, its asset portfolio and the underlying demand trajectory for lithium products, particularly given the status of the Mining Lease ratification process," said chief executive Keith Muller.
Atlantic Lithium said speculation around the lease ratification process had contributed to a trading halt in its shares on the ASX, and noted a Ghana Parliamentary Committee meeting on 12 February to consider the Mining Lease.
The company said it is not aware of the outcome and has not received formal confirmation on the timing, while remaining confident that ratification will be forthcoming.
In explaining its decision, the board also pointed to the wider exploration portfolio, 509km² of tenure in Ghana and 771km² in Côte d’Ivoire, and improving lithium market dynamics, citing a rebound in spodumene concentrate pricing from around US$800/t in mid-October to about US$1,900/t as of 19 February.
Muller added: "Although the Proposal vindicates the work we have achieved to date and endorses the company's strategic direction to advancing its projects in Ghana and Côte d'Ivoire, we remain confident that ratification of the Ewoyaa Mining Lease will be forthcoming, with positive signals currently being received in-country."
"We look forward to providing further updates in due course."
Atlantic Lithium noted that trading of its shares would now resume in Australia.