Azure Minerals Limited (ASX: AZS) has entered into a binding Transaction Implementation Deed (TID) with SQM Australia Pty Ltd (SQM), a wholly owned subsidiary of mining giant Sociedad Química y Minera de Chile.
SQM will acquire 100% of the shares in Azure by a scheme of arrangement, for a cash amount of A$3.52 per Azure share, and a simultaneous conditional off market takeover offer for a cash amount of A$3.50 per Azure share, if the scheme is not successful.
The scheme implies an equity value of approximately A$1.63B for the lithium producer, and represents a premium of:
- 44.3% to the last closing price of A$2.44 per share on 20 October 2023
- 55.9% to the 10-day VWAP of A$2.26 per share up to and including 20 October 2023
- 52.4% premium to SQM’s previous proposal of A$2.31 per share
- 46.7% to the offer price of A$2.40 per share from the company’s most recent equity raising
Azure’s managing director, Tony Rovira, commented, “Having carefully considered the merits of the transaction, the Azure board has unanimously concluded that the transaction is in the best interests of Azure shareholders.”
“Whilst we firmly believe that Andover has the potential to be a major lithium project, there is significant time, cost, and risk associated with developing a project of this scale, particularly in the context of an uncertain broader economic outlook. As such, the board believes that the transaction provides Azure shareholders with a compelling opportunity to de-risk their investment and realize certain value at an attractive premium to historical trading levels.”
Additionally, the transaction is subject to limited conditions, including SQM obtaining approval from Australia’s Foreign Investment Review Board (FIRB). Significantly, it is not subject to any financing or due diligence conditions, and the takeover offer is not subject to any minimum acceptance condition.
Azure will hold a scheme meeting in late January or early February 2024. If approved by the company, shareholders, and the court, the scheme will be implemented shortly thereafter.
To find out more, please visit www.azureminerals.com.au
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