Core Lithium has changed tack after its initial bid for Charger Metals was rejected, and will now acquire a portion of the company through a deal with Charger’s joint venture partner.
The target of Core’s desire for Charger is its Bynoe lithium project in the Northern Territory, which is a 70:30 joint venture with Lithium Australia covering 63km² in a lithium-rich belt near Darwin.
Bynoe is surrounded by tenements that are part of Core’s Finniss project.
Core has now entered into an agreement with Lithium Australia to purchase its 9.8 per cent stake in Charger, comprised of approximately 7.6 million shares.
Lithium Australia is set to receive 6.08 million new Core shares in exchange, which equates to around 0.8 Core shares per Charger share.
At the completion of the deal, which must close before September 20, Lithium Australia will hold a 0.3 per cent holding in Core.
In a separate agreement, Core has also agreed to purchase Lithium Australia’s 30 per cent interest in Bynoe for $500,000 cash.
Under the terms of the joint venture between Charger and Lithium Australia, Charger has a pre-emptive right to acquire the 30 per cent Bynoe interest for the same purchase price of $500,000, for a period of 60 days.
The acquisition by Core will only proceed if Charger declines to exercise this right during this time.
“Core remains open to discussing the progression of its NBIO (non-binding indicative offer) with Charger should Charger’s board be willing to do so in a constructive manner,” Core said in a statement.
Bynoe has shown promising results from recent drilling. Throughout 2023, Charger drilled three diamond and 66 reverse circulation drill holes across seven prospective areas, with results showing lithium and tantalum mineralisation at three of the targets.
There are still more than 20 identified lithium prospects within the Bynoe project that are yet to be drill tested.
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