Lack of follow through buying makes an aggressive suitor very...

Lack of follow through buying makes an aggressive suitor very unlikely. Even if it is Twiggy or another deep pocketed suitor they will be operating through an opaque intermediary and we’ll be in the dark for some time yet. Here’s hoping it’s not a subsidiary of the larger JRO network of companies. Pretty much anyone else will be a boost for AJM since the parcel won’t be hanging over us.

interesting podcast from the fast markets conference in Chile, seems as though Morgan Stanley’s call for nearterm oversupply is looking accurate but that the futures market and huge auto investment in EV creating predictable near term undersupply will be enough to support prices (notes that OEM car manufacturers work to a 5 year model development to mass manufacture corresponding to exactly when lithium demand will likely outstrip supply. For this reason and others they also predicted M&A activity ramping up while the biggest players try and get set ahead of any squeeze. The major concern was that every level of production/conversion being at risk from under investment without a clear source for the needed billions from traditional sources (banks/venture capital etc) leading to speculation re whether OEMs like VW and Tesla will see the crunch coming, risking a spike in battery material and thus battery prices and in turn their ability to produce affordable mass market BEVs, or flipping things on their heads, if a battery supply squeeze is coming and coinciding with the steep part of the EV adoption s-shaped curve a car manufacturer that has locked down vertical supply from mine to car will have an enormous competitive advantage and dominate to the point of killing the competition - again VW and Tesla look the most aligned with that type of strategy.

So, there are reasons here and now, and certainly into the next 12 months for an OEM or battery major wanting to buy AJM in its entirety, the company in their announcements and Cheeseman in the INN interview are all but stating nameplate is possible within months and we have a 26 year life of mine with quality spodumene together with a very low market cap compared to peers from a perfect storm of an ugly debt burden a dysfunctional/failing cornerstone investor selling down and a soft Spodumene price. Indeed we’re seem ahead of PLS in terms of a mine/plant running to specifications and only capital constraints preventing large scalability of our obvious successes in mine/output delivery.

Now consider that JRO have gone, nameplate could be declared alongside the next quarterly which in turn definitively proves profitability even off a quarter where output is clearly still ramping up and thus also shows profits should rise. Also consider that if the spodumene squeeze is due in three yeas that tallies well with a n
acheivable timeline for our stage 2.

If plant performance is proven the question is why hasn’t a suitor moved in? If the narrative above is accurate AJM makes for a far more compelling proposition than many of the slightly odd acquisitions of less good/nearterm assets. It looks like AJM might have timed a small proof of concept plant just in time to be gobbled up...