Galaxy is selling the lithium carbonate plant it developed at Jiangsu, north of Shanghai, to Sichuan Tianqi Industries.
Galaxy is selling the lithium carbonate plant it developed at Jiangsu, north of Shanghai, to Sichuan Tianqi Industries.

GALAXY Resources has signed a binding share purchase agreement with Sichuan Tianqi Industries for the sale of Jiangsu Lithium Carbonate Plant. The agreement will be effected by way of the sale of Galaxy’s Hong Kong subsidiary Galaxy Lithium International.

The transaction values Galaxy Lithium at US$230 million with the consideration comprising cash payable to Galaxy of US$122 million, together with the assumption by Tianqi of US$108 million in Chinese bank debt at the Galaxy Jiangsu level.

Closing of the transaction will radically change the balance sheet of Galaxy from a material negative working capital balance to a pro forma net cash balance of about Aus$62 million. This will enable Galaxy to focus on development of its Sal de Vida lithium brine and potash project in Argentina as its core asset from a position of financial strength.

Galaxy expects completion of the transaction will take about three months from April 30 as it is subject to Galaxy and Tianqi shareholder approvals as well as regulatory approvals in China for Tianqi.

Since the sale announcement Galaxy has been advised that Tianqi shareholders have approved payment of US$12.2 million deposit to Galaxy, as outlined in the binding agreement and deposit representing 10% of the initial cash consideration.

Tianqi holds a significant range of assets in the lithium sector. It is a leading producer of lithium products in China and has also recently acquired a majority interest in Talison Lithium, which owns the Greenbushes lithium operations in Western Australia.

Galaxy’s managing director Anthony Tse says the transaction is a major step in the financial transformation of the company.

“Since becoming responsible for the management of the company, the new Board and executive management team at Galaxy have been entirely focused on the best ways to reduce the interest bearing debt of the company without further diluting shareholders’ equity.

“Completion of the sale of the Jiangsu project will leave the company in a strong net positive cash position with an increase in shareholders’ equity. This will leave the company in a very strong position to extract the maximum value from its remaining portfolio of lithium assets, in particular the Sal de Vida lithium brine project in Argentina.

“Following divestment of the Jiangsu plant, the company will continue to retain significant exposure to the lithium sector through the Sal de Vida project and with Mt Cattlin in Western Australia and James Bay in Quebec.”

The sale agreement follows the signing during the March quarter of a spodumene tolling agreement with Tianqi, to treat 8000 tonnes of lithium carbonate on their behalf. The toll agreement is for an initial the period of 12 months commencing on March 13, with an extension option.


银河资源出售江苏工厂
银河资源已就出售江苏碳酸锂厂事宜与四川天齐锂业签署了约束性购销协议。该协议将受到银河资源香港子公司—银河国际锂业出售的影响。
本次交易的价格为2.3亿美元,包括向银河锂业支付的1.22亿美元的现金,还包括银河江苏工厂1.08亿美元的中国银行债务。
本次交易完成后,银河资源将可根本性的摆脱负债状态,账面净现金余额预计接近6200万澳元。届时其将有充分资金支持核心资产 - 阿根廷Sal de Vida锂盐碳酸钾项目开发。
银河资源预计收购方案可于4月30日启动,并在3个月内执行完毕,因为需要获得协议双方股东批准,且四川天齐应通过中国监管方审批。
该笔交易宣布后,银河资源从天齐锂业获悉,后者股东大会已同意向银河资源先支付1220万美元定金,约束性购销协议中对此进行了规定,该笔资金是初始现金支付的10%。
天齐在锂行业资产众多。它是中国领先的锂产品生产商,并于近期收购了锂矿商Talison大部分资产,Talison在西澳大利亚拥有Greenbushes锂矿。
银河资源的总经理Anthony Tse表示该笔交易是公司财务转型的重要一步。“自履职以来,银河资源的董事会及高管团队致力于在不稀释现有股东利益的前提下寻找减少公司有息债务的方法。”
“本次江苏项目交易完成后,公司账面净现金余额充盈,所者者权益增加。届时公司将有充分资金从其剩余的锂资产组合中获取最大价值,尤其是位于阿根廷的Sal de Vida锂盐碳酸钾项目。”
“在江苏工厂剥离后,公司将通过Sal de Vida项目、西澳大利亚的Mt Cattlin项目以及魁北克的James Bay项目在锂行业继续经营。”
天齐在3月份与银河锂业(江苏)有限公司签署了《委托加工合同》,由天齐提供锂辉石原料,委托银河资源加工8000吨碳酸锂成品,银河出售江苏工厂的交易是在此合同签署后进行的。《委托加工合同》的有效期为2014年3月13日起至2015年3月12日止,可以选择延长期限。

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