Critical Metals Corp. (Nasdaq: CRML) has signed a letter of intent to acquire all outstanding shares of European Lithium Ltd. (ASX: EUR) in a proposed all‑share transaction aimed at simplifying ownership of the Tanbreez rare earth project and strengthening the company’s balance sheet.
Under the proposed terms, European Lithium shareholders would receive 0.035 shares of Critical Metals for each European Lithium share held, implying total consideration of approximately US$835M based on Critical Metals’ unaffected share price and prevailing exchange rates as of 22 April 2026. The transaction remains subject to the execution of definitive agreements and customary regulatory and shareholder approvals.
A central strategic driver of the proposal is the removal of European Lithium’s 34% shareholding in Critical Metals, which the company intends to cancel upon completion. This step is expected to materially reduce shareholder dilution while increasing Critical Metals’ public float and trading liquidity, removing a long‑standing overhang from regular block disposals.
The transaction would also position Critical Metals to consolidate 100% ownership of the Tanbreez rare earth project by absorbing European Lithium’s remaining 7.5% interest, simplifying governance, financing and development decision‑making as Tanbreez advances toward a development decision.
European Lithium brings a substantial cash balance of approximately A$306M (US$219M) as of 31 March 2026, alongside additional marketable securities. Combined with Critical Metals’ existing cash position of around US$124M, the proposed transaction would create a well‑capitalised platform to accelerate Tanbreez development at a time when Western markets are seeking secure sources of heavy rare earth elements.
The transaction is expected to be implemented through two interdependent Schemes of Arrangement covering European Lithium’s shares and listed options. Completion is targeted for the second half of 2026, subject to due diligence, minimum cash conditions, court approvals and regulatory consents.
If completed, Critical Metals expects the transaction to place full control of the company in the public market, while positioning it as one of the most advanced and well‑funded heavy rare earth developers outside China.
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