Lithium Energy (ASX:LEL) has agreed to sell its Queensland portfolio of graphite assets to M Battery Materials for a total consideration of $20 million.
The portfolio of assets includes the Burke, Mt Dromedary, and Corella projects, building on M Battery’s existing portfolio of graphite and vanadium exploration assets in Queensland.
The total consideration comprises $5 million in cash and $15 million in shares.
Meanwhile, M Battery intends to list on the Australian Securities Exchange with a minimum $15 million initial public offering (IPO) to strengthen its focus on developing and supplying materials critical to the global energy transition.
The consideration shares will be distributed in specie to Lithium Energy shareholders, following approval at a meeting and ahead of M Battery’s listing on the ASX.
Lithium Energy intends to subscribe to M Battery shares in the IPO. Lithium Energy’s subscription in M Battery is subject to the finalisation of a subscription agreement. The company will hold 33.33% of M Battery after the completion of the IPO and the in-specie distribution for 100% of consideration shares.
Lithium Energy Executive Chairman William Johnson says the company “created a world-class inventory of high-grade graphite in Queensland” with the consolidation of the adjacent Burke and Mr Dromedary deposits, along with its existing Corella deposit.
“Combining these graphite deposits with the neighbouring graphite and vanadium assets held by M Battery Materials will create an even more substantial and diversified battery minerals asset base,” Johnson says.
“The proposed IPO off these assets and in-specie distribution of shares to Lithium Energy shareholders will provide shareholders with a valuable direct exposure to this new M Resources Group affiliated, global-scale battery minerals-focused company.”
M Group Founder Matt Latimore says the company is “creating a high-grade graphite project on a global scale” with the acquisition of these assets.
“Building on the strong work completed to date, we will now advance the assets through key study and approval stages, with a focus on accelerating development toward battery anode material production,” Latimore says.
“Our integrated capabilities across development, supply chains, marketing, and finance position us to unlock significant value.”
Lithium Energy’s vision is to contribute to global decarbonisation through the innovative exploration and development of sustainable minerals projects. The company’s key mineral assets include lithium, graphite, gold, and copper.
M Battery Materials is focused on developing high-grade graphite and vanadium assets to support the global energy transition.
Write to Maddison Elliott at Mining.com.au
Images: Lithium Energy
