Lithium Americas Corp. (NYSE: LAC) shares displayed healthy gains after the company reported a strategic transaction with Ganfeng Lithium to jointly advance Caucharí-Olaroz.
As a result of the transaction, Ganfeng Lithium will become Lithium Americas’ partner in developing and operating the Project, which is currently under development in Jujuy, Argentina. Lithium Americas’ interest in Caucharí-Olaroz will increase from 50% to 62.5%, with Ganfeng Lithium holding the remaining 37.5% interest.
In connection with the Transaction, Ganfeng Lithium has agreed to provide Lithium Americas with a new $100-million U.S. limited recourse, subordinated loan facility to fully fund Lithium Americas’ share of Caucharí-Olaroz’ capital expenditures.
In addition, Lithium Americas and Ganfeng Lithium have entered into a strategic collaboration agreement to explore future opportunities to collaborate and develop lithium resources. The focus of the Strategic Collaboration Agreement will be on technical and financial collaboration with the objective of identifying and developing lithium resource projects in North and South America that leverage both companies’ respective strengths.
"We would like to thank SQM for providing the support to advance Caucharí-Olaroz into construction, helping to build an independent team in Jujuy and putting the Project on a path to reach first production by 2020," said Lithium Americas’ CEO Tom Hodgson.
"We are also very pleased to welcome Ganfeng Lithium as our new partner at Cauchari-Olaroz to continue development on our previously disclosed timeline and explore future opportunities to collaborate.”
Shares gained 48 cents, or 13.5%, to $4.04.
