VANCOUVER — On June 30 juniors Western Lithium (TSX: WLC; US-OTC: WLCDF) and Lithium Americas (TSX: LAC) announced a strategic business combination agreement the companies hope will create a “leading lithium development company combining expertise, technology, and two significant lithium deposits based in North America and South America.” Western Lithium will acquire Lithium Americas in all-share deal valued at roughly $80 million.
Under terms of the arrangement Lithium Americas investors will receive 0.789 share of Western Lithium for each share held. Based on the companies’ closing prices on June 29 the offer values Lithium Americas at around 50¢ per share, which represents a 36% premium. Western Lithium will continue to be led by CEO Jay Chmelauskas, while Lithium Americas executives Tom Hodgson, John Kanellitsas and Franco Mignacco will join the joint board of directors.
“The merged company will hold two of the leading lithium development projects in the world. We believe this combination will also result in better liquidity, market capitalization and funding opportunities,” said Chmelauskas in a prepared statement.
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