A few of us have posted about our theories on RIO, and a possible tie up.
This Authier business, or being tied up in a BAPE process when we didn't have to, feels very unusual.
Last year, there were a flurry of reports, which not only indicated RIO's active search for lithium projects, but also tying RIO to Sayona and Authier.
More recently-
Bloomberg Feb 23, 2023
'Lithium is Rio Tinto’s No. 1 target for deals, but it’s found that companies such as Tesla Inc. seem willing to outbid it for a commodity that Chief Executive Officer Jakob Stausholm today branded “very expensive. Rio is keen to grow in lithium, a key ingredient to make batteries for electric vehicles. So far, it’s bought a lithium mine in Argentina for $825 million, but plans for its flagship Jadar project in Serbia were dashed last year when the government blocked the development after thousands of protesters took to the streets to oppose it. That’s left the company looking to buy more lithium, asking the biggest investment banks for pitches on miners. Yet so far, it’s finding the asking prices high.'
We have previously discussed RIO's involvement. They are on a serious hunt for stable, long term lithium projects. their initial attempts are yet to bear big gains, so are looking worldwide for suitable projects.
Have the improvements to our production circuit, improved the grades and recovery rates from NAL only ore, to no longer require to blend Authier's ? Is the end game to divest Authier, now we have secured further claims and probable tonnage via Jourdan's Vallee?
Authier was a big part of our strategy last year, but lately seems to have been cast into the background, with no sense of urgency, and our emphasis now shifting, on growing our existing claims around Moblan and NAL.
Late 2022, Authier was linked to RIO in a couple of broker reports and some speculation by analysts.
RIO have a long history in Canada and are favoured by the Canadian government, who has granted them significant funds in the past. They are also very familiar with Authier's ore, being used in their spodumene concentration testing at RTIT-Sorel-Tracy Quebec in 2022, which yielded concentration levels of 10% plus (SC10), and only produced a dry, inert waste.
The demo plant produced concentrate tonnages- "demonstrated at industrial scale a new spodumene concentration process that provides lithium oxide (Li20) grades and recoveries well above the industry average.
Did RIO find something else in Authiers ore-PGE's, CU, Au, Ag, REE's , scandium, Tantalum etc... which have peaked their interest in acquiring Authier? Authier, which we all know, WAS Sayona's premier project pre NAL, and could be delivered on a platter, with all studies and permitting complete.
Possibly a JV with RIO at Authier. with possible production at Amoss?
Or, will Authier be divested to RIO, the proceeds of which will further the Vallee/NAL tie up and expansion?
Or is Sayona itself, a target?
This has been mentioned by management before.....being an acquirer, or being the acquired???
For me, this is the primary reason we are yet to see Moblan's results officially announced to the market .
If assays are returned as they are examined.....hole by hole, with the amount of shorters we have, it would probably spike the SP for a couple of days and then be sold back down. Mr. Market would get an official sniff of what we have, and foster a takeover bid.... while we are 23c, would be swift and brutal.
If they are announced as a complete package, with a massive resource upgrade, high concentrations, ore uniformity and consistency, low strip ratios, and other elements present in commercially viable quantities, we would rerate very quickly and could be at 30 and beyond in the blink of an eye. A takeover would then be at least 50% more costly and more difficult..... at 23c, we are an easy and cheap target for an aggressive target by a behemoth like RIO.
Most LT holders here would say, you can have my shares for a dollar or $1.50....I get it....we see the potential...and so would the acquirer.
There would probably be enough institutions who would take a 30-40% premium over what they paid. And so would PLL, if the acquirer swung a deal to honour their original offtake for a period of time AND they were rewarded handsomely for their stake in SYA and SYAQ.
The top 12 shareholder, all institutions own 41.52% of the company
Another 10% and they are over 50% ...if some further instos and big retail holders jump...
For a controlling interest or 50.1% take over-
23c x 30% premium= 30c takeover = 30c x 8.9bill/2 = AU$ 1.3 bill takeover bid...... 23 x 40% premium = 32.2c takeover= 32.2 x 8.9bill/2= AU$ 1.43 bill takeover bid...... 23 x 50% premium = 34.5c takeover = 34.5x 8.9bill/2 = AU$ 1.55 bill takeover bid...
Chump change for RIO, whose MC is AU$173bill on all exchanges combined.
If we rerate to 32, then a 50% premium takeover would cost 32 plus 50% premium= 48c x 8.9/2 bill = AU$2.15 bill takeover bid...and would probably be a lot more difficult to sway investors, once they know what we have at Moblan. During the same period, we should also have a carbonate PFS in hand, further assays from Vallee, and possibly have purchased Resolute's old mill at Amoss, and hopefully a big fat new offtake partner.
This makes us more valuable, and harder and harder to acquire.....maybe too hard.
Anyway, that's my 2c, and a possible reason why Moblan results are so far being tightly held....and a possibly why we have not seen the remaining 3 holes from Authier....
(20min delay)