Energy Exploration Technologies (EnergyX) has put forward an unsolicited, confidential, conditional, and non-binding indicative offer to acquire Galan Lithium’s Argentinian lithium assets. The proposal includes $50 million in cash and $50 million in EnergyX shares.
EnergyX, headquartered in Puerto Rico, is not currently listed on any stock exchange.
Galan Lithium’s Argentinian assets are situated in Salar del Hombre Muerto and Candelas. Besides the acquisition cost, EnergyX has pledged an additional $50 million investment. This funding is intended for the initial commercial phase of lithium production at the Hombre Muerto West project and for maintaining the project assets.
Additionally, Galan would receive a 10% gross revenue royalty from commercial production for a decade.
Negotiations between Galan and EnergyX are in progress, with Galan aiming to secure a confidentiality agreement regarding the proposal. This agreement is pending with EnergyX.
The offer is contingent on several conditions, including satisfactory due diligence and the negotiation of definitive, binding transaction documents.
In a press release, Galan stated: “The proposal remains subject to consideration by Galan’s board, and given the early-stage nature of discussions and its conditionality, there is no certainty a transaction will occur. Given the proposal involves the disposition of Galan’s main undertaking, shareholder approval would be a necessary condition for completion under a binding agreement, if such an agreement were to be reached.”
EnergyX CEO Teague Egan, in a statement to Reuters, expressed the company’s intent to acquire Galan’s Argentinian assets to consolidate their holdings during a period of low prices. Egan noted, “There is no doubt in my mind that lithium demand will continue to grow later this decade.”
