IGO Limited (ASX:IGO) has entered into a scheme implementation agreement (SIA) to acquire 100 per cent of Essential Metals Limited (ESS) for $0.50 per share through the lithium joint venture entity (TLEA) owned by IGO (49 per cent) and Tianqi Lithium Corporation (51 per cent).
The transaction represents a 36.3 per cent premium ESS’s 30-day volume weighted average price and values the company’s equity at $136 million on a fully diluted basis.
ESS is a lithium exploration company which owns 100 per cent of the Pioneer Dome Project in Western Australia.
Pioneer Dome is located approximately 130 kilometres south of Kalgoorlie and 200 kilometres north of the port of Esperance.
The project covers an area of 450 square kilometres and is in close proximity to the Mount Marion and Bald Hill lithium projects.
Pioneer Dome is one of only 14 JORC-compliant spodumene lithium resources in Australia, with a defined JORC resource of 11.2 million tonnes at 1.16 per cent lithium oxide.
ESS also holds several other interests in early-stage exploration projects across lithium, nickel and gold.
IGO’s Acting Chief Executive Officer Matt Dusci said: “Both IGO and [Tianqi] are committed to progressing and growing our lithium joint venture business.
“The ESS transaction provides an opportunity to accelerate lithium exploration to bring new resources to production.
“It also complements the significant growth opportunities within the TLEA business which include the continued expansion of the Greenbushes operation, the successful ramp up Train 1 of the lithium hydroxide facility at Kwinana, and progressing towards the financial investment decision for Train 2.
“We look forward to supporting TLEA with future work programs over the ESS assets, as the joint venture seeks to bring new resources to production to address the market deficit of raw materials critical for clean energy transition.”
