Lithium Energy Limited (ASX:LEL) Amended Solaroz Project Sale Terms
Lithium Energy Limited (ASX:LEL) has reached an amended agreement with CNGR Netherlands New Energy Technology B.V. regarding the sale of its 90% interest in the Solaroz Lithium Brine Project in Argentina. The cash sale consideration remains at US$63 million (approximately A$97 million), but several terms have been modified to streamline the transaction.
Amended Agreement Highlights
The amended sale agreement removes all conditions precedent that previously delayed the completion. CNGR will make a second deposit of US$6 million in January 2025, following shareholder approval of the amended agreement. This second deposit, alongside the initial non-refundable deposit of US$1.8 million made in May 2024, is secured against the overall transaction.
Under the revised terms, CNGR will pay a total of US$26 million on 24 April 2025 for a 39.9% shareholding transfer of Solaroz, followed by a payment of US$21.7 million on 9 January 2026 for the remaining 50.1%. Additionally, deferred consideration of US$4.5 million is contingent on the Benchmark Lithium Carbonate Price exceeding US$23,000 per tonne.
Future Funding and Operational Development
As part of the deal, CNGR has agreed to contribute up to US$15 million via unsecured loans for Solaroz operations starting from January 2025. This funding will facilitate the next stages of exploration and evaluation at the project site, which is strategically located within South America’s “Lithium Triangle.”
Shareholder Approval and Next Steps
Completion of the transaction will require shareholder approval, with a general meeting scheduled for January 2025. Director William Johnson remarked, “The amendments allow us to focus on enhancing the operational capacity of the Solaroz Project while ensuring a steady cash inflow for future developments.”
Both parties have waived prior requirements for CNGR’s registration as a foreign company in Argentina and environmental approval conditions, which will facilitate the smoother execution of the agreement.
Motley Fool contributor Kiarra Jackson has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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