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Wednesday, May 18, 2022

Lithium Americas [NYSE: LAC] Announces Acquisition of Millennial

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Lithium Americas Corp. [NYSE: LAC] disclosed that it has inked an agreement to purchase all of the outstanding shares of Millennial. LAC will buy Millennial by way of a plan of arrangement for C$4.70 per ML Share, payable in common shares of Lithium Americas and C$0.001 in cash per ML Share.

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It signifies a total payment of around US$400 million. This payment would result in Millennial Shareholders owning around 9.1% of Lithium Americas based on Lithium Americas’ closing price on November 16, 2021. This transaction is a unique opportunity for LAC to add a harmonizing lithium brine project and utilize its knowledge developing Caucharí-Olaroz as the largest new lithium carbonate operation to come online in over 20 years.

Furthermore, Millennial’s board and management contemplate that the LAC Arrangement Agreement offers substantial value to Millennial Shareholders. The high premium to the CATL Arrangement Agreement underscores the quality of the Pastos Grandes project and the efforts by the Millennial team over the past four years.

In addition, Lithium Americas is convinced that Pastos Grandes can offer significant value for all shareholders as it executes its growth strategy in the region over the coming years. Moreover, Millennial ended the arrangement agreement between Millennial and Contemporary Amperex Technology Co., Ltd. (CATL) dated September 28, 2021, before entering into the LAC Arrangement Agreement.

Strategic Rationale

This transaction provides a significant premium of around 22.1% to the price offered under the CATL Arrangement Agreement to Millennial Shareholders. LAC Shares are listed on the New York Stock Exchange (NYSE) and the TSX and are expected to have increased trading liquidity compared to the ML Shares. Additionally, the addition of Millennial’s Pastos Grandes lithium brine project in Salta province offers an attractive regional growth opportunity in proximity to Caucharí-Olaroz with the potential for Lithium Americas to extract significant synergies.

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