Lithium: Alliance has a new majority shareholder — Galaxy Resources
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Wesfarmers announced that seminal $776m bid for Kidman; now everyone’s speculating — ‘who’s next?’
This morning, Galaxy Resources (ASX:GXY) tipped $22.5m into fellow producer Alliance Mineral Assets (ASX:A40) to become its largest shareholder.
It’s not M or A, but it is a step in the right direction.
The $650m market cap Galaxy has been interested in its smaller rival for some time, allegedly.
The company already held a minority stake prior to the placement, says Galaxy chairman Martin Rowley.
“We welcome this opportunity to increase our holding and become the largest individual shareholder in Alliance,” he says.
Rowley also highlighted the “high quality concentrates” of A40’s Bald Hill mine and its substantial exploration upside.
“Galaxy … believes that the tenements surrounding the existing Bald Hill mine operations hold substantial value potential, that may be unlocked through further targeted exploration and work on resource delineation.”
“We look forward to cooperation between the two companies and sharing our Mt Cattlin experience with Alliance.”
This was part of a larger $32.5m placement at 20c per share, which also included $10m from a subsidiary of Jiangxi Special Electric Motor Co.
The Galaxy and A40 share prices increased 1.2 per cent and 7.5 per cent respectively in morning trade.