the deal involves approx. 1m cash and 1m shares. Even if Galan were to write it off, it wouldn't cause a major blow to the company. However, i think what market dislikes are:
(1) The project won't generate any profit or cash flow within the next 8 years, only potential cash outflow, so why bother.
(2) Galan is giving in too much to Redstone. Its HMW needs funding, is Galan in a good position to be a financier to Redstone?
(3) The related party involved, namely the Chairman.
In other words, market is questioning the decision making prowess of the management team. Today if HMW is fully funded to stage 2 and Halan has 200m cash in its balance sheet, this news would have been brushed aside easily.
Ann: Key Canadian Lithium Project Acquisitions, page-82
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