Lithium Power International - Gaining full control of Maricunga

Lithium Power International (LPI) has announced plans to acquire 100% control of its flagship Maricunga lithium project by way of a three-party all-share merger with the project’s minority owners. The transaction values LPI’s remaining c 48% share in the project at A$90m, which is a significant discount to our project valuation, and allows the company to streamline the project’s ownership structure ahead of the anticipated final investment decision. We have updated our financial model and valuation of LPI to reflect the transaction and the lower share price and associated higher funding dilution. Despite the current weakness in lithium shares against the backdrop of slowing economic growth, lithium prices remain high and the sector’s longer-term fundamentals are intact.