....this is very sad and unfortunate, and this underscores why it is so important we do not allow unbridled faith and optimism to get the better of us.
....often the market is not wrong when a stock keeps falling in price. AVZ flags delisting, shareholders face $2.8 billion wealth wipeout Tom RichardsonJournalist
May 1, 2024 – 12.53pm
Shareholders in sin-binned lithium explorer AVZ Minerals face one of the biggest wealth wipeouts in sharemarket history after management said it will delist from the ASX on May 13 as it battles for control of the world’s largest hard rock lithium deposit in Africa.
The Perth-based explorer has more than 21,100 shareholders with paper wealth of $2.8 billion tied up in the shares that last traded on the ASX in May 2022 for 78¢.
AVZ Minerals is in a dispute over ownership rights to potentially the world’s largest lithium deposit.
“After careful consideration, the AVZ board has resolved not to seek reinstatement on the basis a reinstatement at this time would not be in the best interests of AVZ shareholders,” the board said in a statement on Tuesday evening.
It blamed the prospective delisting on the Democratic Republic of Congo government’s failure to comply with court orders, and multiple other legal battles it has with Chinese and Congolese mining rivals for control of the Manono tenement in the resource-rich country’s south-west.
Shareholders took to social media and message boards to vent their frustration at the outcome with some blaming the miner’s management, while others blamed overseas corruption.
AVZ raced to a $4.6 billion market valuation in April 2022 and snagged a place in the S&P/ASX 200 Index on management’s public confidence it would secure a licence to mine the Manono deposit now estimated to be more than twice the size of Australia’s richest lithium mine, Greenbushes.
The Manono mine could be around twice the size of Western Australia’s famous Greenbushes mine. AVZ
However, in May 2022 the explorer entered a trading halt after it disclosed to investors that it faced a legal dispute with Chinese and Congolese rivals over ownership rights to the Manono deposit.
On Tuesday, AVZ’s board said the decision to delist was in its best interests of shareholders, who will retain their ownership rights in the company as a private entity with the miner to update investors on the company’s operations via its website.
“Investigations suggest a person who had access to its confidential and price-sensitive information, and was responsible for disseminating that information to certain Australian news outlets, no longer has such access,” the company said on Tuesday.
