Lithium Chile Evaluating Multiple Expressions of Interest For South American Assets

FULL DISCLOSURE: This is sponsored content for Lithium Chile.

Lithium Chile (TSXV: LITH) continues to work through expressions of interest as identified by the company back in a March 9, 2023 release. At the time, Lithium Chile indicated that it had receipted an expression of interest from an arms-length party for the potential acquisition of certain of its South American assets.

Discussions on the matter are now said to have progressed, with additional interested parties also stepping forth to enter the bidding war.

As a result of the interest from third parties, the company has retained PI Financial Corp as corporate financial advisor to assist in evaluating the current options.

“We are flattered but not surprised to have received so much interest in our assets as they are among the best lithium salars in South America. PI Financials appointment will help us to deliver maximum value for our shareholders,” commented Steve Cochrane, CEO of Lithium Chile.

The company meanwhile remains focused on its growth strategy, with the advancement of the Salar de Arizaro project in Argentina said to have generated opportunities for the company following the preliminary economic assessment that valued the project at a $1.1 billion NPV on an after-tax basis using an 8% discount rate.

WATCH: Lithium Chile: US$1.8 Billion Pre-Tax NPV(8%) At Arizaro – With Michelle DeCecco

In addition to the large NPV, the project is said to boast an after-tax internal rate of return of 24.1%, based on the production of 25,000 LCE per year over a 19.1 year mine life. Operating costs are estimated at $5,197 per tonne of Li2CO3, while the estimate uses a life of mine average price of $21,396 Li2CO3 per tonne.

The company meanwhile cautioned that there are no guarantees that the current expressions of interest will result in a transaction being completed.

Lithium Chile last traded at $0.72 on the TSX Venture.

FULL DISCLOSURE: Lithium Chile is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of Lithium Chile. The author has been compensated to cover Lithium Chile on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.

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