Why would any rational strategic investor pay US$200M for just 50% of the Adina/Renard project? That scenario simply doesn’t add up. A strategic genuinely interested in the project could likely acquire the entire company at a 100% premium to its current market cap.
WR1’s current market cap is around US$48M, meaning a full buyout at a 100% premium would cost approximately US$96M. If they were only after the lithium assets, they could then offload the PWM holding, which is currently worth ~US$29M, plus the additional PWM options which are worth ~US$5M, for a total of US$34M.
That leaves a net investment of just US$62M to acquire not only Adina/Renard but also Tilly, Cancet, Sirmac-Clapier, AND the PWM offtake rights. Given that, why on earth would they pay over three times that amount—US$200M—for just 50% of a single project?
Make it make sense for me.
WR1 Price at posting:
30.5¢ Sentiment: Hold Disclosure: Held
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