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Building|Construction|Financial|PROJECT|Bearing
Building|Construction|Financial|PROJECT|Bearing
building|construction|financial|project|bearing

Gangfeng takes controlling share in Argentina JV with Lithium Americas

10th February 2020

By: Marleny Arnoldi

Deputy Editor Online

     

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TSX- and NYSE-listed Lithium Americas Corporation (LAC) has entered into definitive agreements with Ganfeng Lithium which will alter the ownership structure of its joint venture (JV) company Minera Exar.

Minera Exar owns 100% of the Caucharí-Olaroz lithium project, which is currently being constructed in Argentina.

Ganfeng will subscribe for new shares in Minera for $16-million, increasing its interest from 50% to 51%, while LAC owns 49%.

Additionally, LAC and Ganfeng have agreed to restructure Exar Capital – a jointly controlled entity that provides funding to the project – to reflect the proportionate ownership of the JV. 

As part of the transaction, Ganfeng will provide $40-million to Exar Capital in non-interest-bearing loans.

The proceeds of the loan will be used to repay intercompany loans owing to LAC, with $20-million to be paid on closing of the transaction.

LAC president and CEO Jon Evans commented in a statement last week that the transaction with Ganfeng further strengthened the company’s balance sheet, while ensuring that the Caucharí-Olaroz project’s construction continued to advance as planned.

“For LAC, the transaction reinforces our strategy of building a low-cost lithium operation in Argentina, and provides funding to advance our second flagship project, Thacker Pass, situated in Nevada, towards construction.”

The revised structure of the JV will improve Ganfeng’s financial flexibility and position regarding regulatory approvals in China.

The Caucharí-Olaroz  project remains on schedule to start production at 40 000 t/y of battery-quality lithium carbonate early next year.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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