Australian mining company Future Battery Minerals has executed a binding share sale agreement with Austroid, a US-based clean energy company, to divest its 80% stake in the Nevada Lithium Project (NLP) in Nevada, US, for a total cash consideration of A$4m ($2.6m).
Nevada Lithium Corp (Nevada Australia) holds the rights to the NLP through its wholly owned subsidiary Nevada Li Corp (Nevada US).
The total cash consideration includes an initial non-refundable deposit of A$50,000 already received, and the remaining A$3.95m to be paid upon completion.
The funds from this transaction are earmarked for the development of the company’s key lithium projects in WA, including Kangaroo Hills Lithium Project (KHLP) and Miriam Lithium Project (Miriam) in the Goldfields region, as well as for general working capital purposes.
Completion of the sale is contingent on several conditions including the waiver of pre-emption rights by the minority shareholders of Nevada Australia or their confirmation of non-interest in acquiring Future Battery Minerals’ 80% interest.
Additionally, the deal stipulates that no material adverse changes should affect Nevada Australia, Nevada US or NLP.
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By GlobalData
Future Battery Minerals managing director Nicholas Rathjen said: “We are very pleased with the terms agreed for the sale of our interest in the NLP. While this asset offers large-scale claystone lithium development potential, we strongly believe that focusing on our highly prospective lithium assets in the WA Goldfields will deliver the best returns for our shareholders.
“The sale of a non-core asset is an effective and efficient capital management tool by delivering a significant increase in cash without diluting shareholders.
“The company will emerge with a significant circa $8.7m cash balance post sale completion and delivers the business a substantial runway for the targeted and efficient exploration of the KHLP and Miriam over the next couple of years, as well as a robust position from which to explore new business development opportunities.”
The transaction is due to be finalised in Q4 2024.
After the completion of the sale, Future Battery Minerals is expected to have a pro forma cash balance of A$8.7m. This figure combines the cash from the sale with the company’s existing cash balance of A$4.7m as of 30 September 2024.
