Over the last two weeks, there hardly went a day without a major announcement in the Lithium industry or the Electric Vehicle (EV) space – which is the main driver of Lithium Demand. Here, we catch you up on the all the latest stories to hit the news.
Breaking as we are releasing this news update, Tawana Resources (TAW) is planning to spin out a number of its unexplored Lithium and Iron Ore assets. The spin out will allow Tawana an increased focus “to drive growth in mineable reserves and extend associated mine life at the Bald Hill project” in which they’ve only explored 5% of the land to date.
Our Take: This is an interesting and exciting development in the Lithium sector. Spin offs are nothing new in the financial industry and are a great way of unlocking value. The company indeed states that by dividing the company into two – it will unlock value for shareholders of the new company “SpinCo.” What’s interesting is that the company felt that they specifically needed to separate the company into two when other companies are using cash flow from their current producing project to fund operations of the exploration assets. Tawana’s take is the complete opposite approach. One reason for this could be the company would rather sell off the assets in their entirety instead of developing them on their own. This would limit their cash investment into the projects and immediately unlock value for shareholders of the SpinCo. So far, the company’s shares are up +5% in response to the deal. The press release can be found here. For more information on spin offs, we recommend you follow our friends at http://www.stockspinoffs.com/. Furthermore, The best book to read on spin offs is by Joel Greenblatt and is called “you can be a stock market genius: uncover the secret hiding places of stock market profits.”
For a full overview of the latest EV announcements, check out the following piece by Reuters where it outlines company by company’s plans regarding amount and types of vehicles they plan to launch.
There’s much to do about what will happen with a large percentage of SQM which is up for sale. Tianqi is interested in the stake but will the Chilean government allow the purchase to happen? As a reminder, Tianqi is an original member of the Lithium Oligopoly. Until recently, only a few companies controlled the space. Since prices tripled for Lithium, over 200 companies have flooded the space. If Tianqi would buy this portion of SQM, further power would shift back to the Oligopoly. For more on this, we recommend you read here and here.
Speaking of purchasing stakes, there are many rumours around who might potentially acquire Altura Mining. For more on this, see our latest article on the story here.
In case you missed it, we highly recommend you read a piece which was featured in the WSJ over this past weekend on Lithium technologies, anodes, cathodes and so much more.
This just in, Electric Taxi’s in London can now be charged in 30 minutes at one of the 100 rapid charging stations across the city.
There’s been a management shake up at International Lithium Corp. The previous CEO and founder, Kirill Klip is out and John Wisbey is now in. The project is important to keep tabs on since one of the shareholders and owners of the project, Ganfeng Lithium, is one of the most powerful companies in the industry at the moment. We hope to publish more on this shortly.
Piedmont Lithium is powering ahead with its U.S. listing. After Lithium Americas and soon to be FMC’s Lithium business, Piedmont will be the only other 100% pure play Lithium company to be traded on a major US exchange.
Consolidation in the space continues in 2018. Neometals acquired the MtEdwards Project which will now be their second lithium project after their very successful stake in the Mt Marion Lithium project already in production. Additionally, the company is heavily invested in the recycling of Lithium as well.
“Volkswagen AG secured 20 billion euros ($25 billion) in battery supplies to underpin an aggressive push into electric cars in the coming years, ramping up pressure onTesla inc. as it struggles with production issues for the mainstream Model 3.” LG Chem, Samsung and Chinese battery maker Contemporary Amperex Technology Co Ltd (CATL) will deliver batteries to VW.
CATL invested in the North American Lithium (NAL) company. We recently wrote a piece about NAL and would like to clarify our remarks. The company recently began producing 5.5% spodumene concentrate at 300 tonnes a day. This comes out to around 9,000 tonnes a month. Surprisingly, the company does not make any mention of this on their site. Yet, we spoke with management and confirmed these figures a few days ago. We apologize for any confusion.