Running discussion on SP, page-18639

With all this volume, it definitely looks like something may happen on the takeover front.

AVZ is still at a ridiculously low SP based on what we've got. The mad rush for lithium part 2 is only just beginning as the world realises that EVs are the future.

For Roche Dure alone we've got 400Mt @ 1.65% for 6,600,000 tonnes of contained Li2O. The WES/KDR takeover value was $547.44 per tonne.

Given the DRC and project development risks (financing, power, roads, met tests etc), what discount is reasonable for AVZ's world class deposit? I think a discount of 50% to 75% is still extremely high, but acknowledges the risks whilst recognising that AVZ's deposits are world class in size, scale, contained lithium and likely low impurities.

A 50% to 75% discount would also recognise that Carriere de L'este is likely to be as large or even larger than Roche Dure, with possibly higher grades. Whoever controls the monster of Manono will have a big say in controlling the world lithium market in years to come!

So what does a 50% to 75% discount look like? Assuming all options and performance shares are exercised:

75% discount = 6,600,000 tonnes (Li2O) x $547.44 (WES/KDR multiple) x 60% (AVZ interest) x 25% (ie. a 75% discount) / 2.565 billion shares = $0.21 per share

50% discount = 6,600,000 tonnes (Li2O) x $547.44 (WES/KDR multiple) x 60% (AVZ interest) x 50% (ie. a 50% discount) / 2.565 billion shares = $0.42 per share

It will be interesting to see how this plays out. EVs and the required lithium content in batteries is clearly the future. Manono has not one but two world class deposits, however it's in the DRC. At $137 - $274 per tonne of contained Li2O, any purchaser of AVZ (if it does come to that) would still be getting themselves a world class bargain.

If it does come to a takeover scenrio, a price of $0.21 to $0.42 per AVZ share would also be a little more palatable to long suffering shareholders if management can't get this to a producing mine themselves.