I don't believe in coincidences, especially when it comes to...

I don't believe in coincidences, especially when it comes to investment banks making money on the market when their banking arm just happens to be arranging loans/placements. I suspect we will either get an announcement about the deal or a trading halt on Tuesday morning.

Some of the Ganfeng talk has also been about their planned 50,000t/a hydroxide plant to be built Fengcheng city in a JV. 50,000 tonnes of lithium hydroxide would need about 350,000 tonnes of 6% spodumene. The plant at Goulamina would have an output of 436,000 tonnes of SP6/a on average, giving the new plant just enough even in the low production years.
The new hydroxide plant could be designed for the exact type of spodumene concentrate produced from one mine for over 20 years. Not too many mines can produce consistent supply for 20 years. There is plenty of extra resources for expansion as well.

Looking at the potential deal itself, it's possible there is $US250m for say a 30% interest. Ganfeng are not paying Firefinch $250m, but it is going into a company they will own 30-40% of, so realistically it is only costing them either 60% or 70% of the $US250m, because of the percentage of their own money they continue to own in the new company.

Because there was competition for the asset, I expect the deal could look like $US250m for 30%, shareholders get 40% and Firefinch keep 10% of Newco. Maybe the percentage will be 35% GF and 5% FFX, but thereabouts would be my thinking. At $US250m this would value Newco (including govt 20%) at $US833m or 67% of current NPV.

Considering the current SP6 price is above the DFS price of $US666/t, with pundits forecasting much higher prices after 2025, the NPV in the DFS would seem low, plus the 8% interest rate in the NPV calculation seems high in the current low IR environment.
The reserve is only about 50% of the resource and the resource itself can easily grow, so again cheap based on what is possible for the future. Given competition for the share of Newco, the $US250m for 30% of the asset, with the whole $US250m in the bank of Newco, it is a cheap buy for a long life large mine.

Then again because our directors were not desperate sellers, and could say no to any lowball offer, and given the lack of other large spodumene resources available, perhaps the BOD did a better deal than above?

Anyone else with thoughts about this? Whichever way it goes, the actual de-merger is still months away as the deal might need FIRB approval or some other regulatory approval, so even if it does add a theoretical 35-40c to our Share valuation, we probably wont see all of that added to the SP until all approvals received. However the market should still react very favourably to the deal.

All IMHO of course...