leadf
logo-loader
viewNeo Lithium Corp

Neo Lithium poised for C$8.5M investment from leading Chinese battery manufacturer; shares surge

A subsidiary of Chinese group Contemporary Amperex Technology (CATL) will subscribe for over 10.2 million shares in a placing at C$0.84 each

Neo Lithium Corp -
CATL is a global leader in the development and manufacturing of lithium-ion batteries

Neo Lithium Corp (CVE:NLC) (OCTMKTS:NTTHF) (FRA:NE2) announced an C$8.5 million investment from a Chinese manufacturer of lithium-ion batteries for electric vehicles (EVs) as the junior continues to advance its 3Q project in Argentina - a high-grade lithium brine lake and salar complex in the 'Lithium Triangle'.

A subsidiary of Chinese group Contemporary Amperex Technology (CATL) will subscribe for over 10.2 million shares in a placing at C$0.84 each for gross proceeds of C$8,582,702, said Neo Lithium. It gives CATL an 8% stake in the lithium miner.

READ: Neo Lithium continues to advance 3Q project in Argentina; notes strong balance sheet

The investment will strengthen Neo Lithium's finances and move it a step closer to the development and construction of the 3Q project, the firm said in a statement.

"The company completed a positive pre-feasibility study in May 2019 and going forward, the company together with the technical assistance of CATL, will finish the definitive feasibility study (DFS) in order to define the precise financing requirements for the 3Q project," it added.

"The DFS will evaluate the economic feasibility for a project with a nameplate production capacity of approximately 20,000 metric tons of battery quality lithium carbonate, with expansion capacity up to 40,000 metric tons per year of battery quality lithium carbonate."

Headquartered in Ningde, China, as of last year, CATL has more than 26,000 employees around the world. It is a global leader in the development and manufacturing of lithium-ion batteries and its activity covers R&D, manufacturing and sales in battery systems for new energy vehicles and energy storage systems.

"As we have said many times, we believe it's extremely important to have a strategic partner with unique knowledge of the expected end-market demand, before concluding the DFS. We are confident that CATL will help us define the battery-grade quality and certification of the final product to highest levels," said Neo Lithium CEO Waldo Perez.

The CATL investment means Neo Lithium's balance sheet now stands at more than C$37 million of cash.

CATL will be entitled to nominate one non-executive director to Neo Lithium's board, while it holds at least 8% of equity. It also the right to participate in future equity offerings in order to maintain its ownership.

The Chinese group will also have the right to nominate one person to the Technical Committee, to help oversee the preparation of the final DFS to be submitted to the board.

Shares rocketed up 31% on Monday in Toronto, at C$0.76 each.

---Updates for share price---

Contact the author at giles@proactiveinvestors.com

Quick facts: Neo Lithium Corp

Price: 0.68 CAD

TSX-V:NLC
Market: TSX-V
Market Cap: $79.9 m
Follow

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Neo Lithium Corp named herein, including the promotion by the Company of Neo Lithium Corp in any Content on the Site, the Company receives from...

FOR OUR FULL DISCLAIMER CLICK HERE

Neo Lithium reveals C$8.5 million investment by CATL to advance its...

Neo Lithium Corp.(TSXV: NLC) (OTCQX: NTTHF) CEO Waldo Perez tells Proactive that Chinese battery manufacturer Contemporary Amperex Technology (SZSE: 300750) has agreed to invest C$8.5 million into the group, representing an 8% equity stake in Neo Lithium. Perez says the financing gets the...

1 week, 5 days ago

3 min read