CATL to increase share holdings in Neo Lithium

Contemporary Amperex Technology (CATL) plans to increase its investment in Neo Lithium (TSXV: NLC) and hold an 8% interest in the lithium mining company after Neo recently announced a $ 30.19 million financing. On Tuesday, the Chinese battery maker Neo Lithium announced its intention to subscribe to 860,870 common shares of the company at a price of C $ 3.05 per share in a non-brokered private placement for a total of C $ 2.62 million in gross proceeds. According to an agreement on investor rights between the parties, CATL has a right of co-determination to maintain its proportional stake in the company. That right was triggered by the buy-deal private placement of special warrants that Neo Lithium arranged last month. The net proceeds from CATL's investment will be used to fund development work on the 3Q lithium project in Catamarca, Argentina. The 3Q project is one of the largest brine deposits in the world in terms of size and grade and contains an estimated 1.3Mt LCE (lithium carbonate equivalent) in proven and probable reserves. In March 2020, Neo announced the production of battery grade lithium carbonate using concentrate from the 3Q project at its pilot facility in Fiambalá. Neo Lithium shares rose 0.9% to C $ 3.26 by Tuesday noon on the TSX Venture Exchange. The company's market capitalization is C $ 417.5 million. Broker Canaccord Genuity recently raised its price target on Neo Lithium from C $ 3.40 to C $ 4.20 after it was announced that it had improved the purity of battery-grade lithium carbonate produced at its pilot facility.