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Galaxy Resources executes pact with POSCO to sell Northern Package of lithium tenements

Metal News - Published on Wed, 29 Aug 2018

Image Source: fool.com.au
Galaxy Resources Limited announced that it has executed binding definitive documentation with POSCO for the sale of a package of tenements located on the northern portion of the Salar del Hombre Muerto in the northwest region of Argentina, for a cash consideration of US$280 milion. This consideration will be paid to Galaxy upon completion of the relevant tenement transfer and registration procedures in Argentina. The tenements the subject of the transaction are listed below.

The sale tenement package is situated to the north of Galaxy’s world class Sal de Vida Project in Argentina. Galaxy will continue to retain a 100% interest in the tenements on the southern area of the Salar del Hombre Muerto. located in Catamarca Province, which are included in the updated feasibility study for Sal de Vida

In addition. Galaxy and POSCO will continue to explore potential cooperation to maximize future development and operational synergies for their respective projects on the Salar del Hombre Muerto.

Completion of the transaction is expected by Q4 2018, following finalization of the necessary procedures to affect the transfer and registration of the relevant tenement package. The net cash proceeds from the transaction will be used towards advancing the development of the Sal de Vida Project Galaxy, with the assistance of J.P. Morgan, is progressing the evaluation of strategic partners for the development of the Sal de Vida Project. The Company will be providing further updates to the market on the JP Morgan process in the near future.

Chairman of Galaxy, Martin Rowley commented that “This transaction with POSCO underlines the significant previously unrecognized value of Galaxy's tenements on the Salar del Hombre Muerto and provides a substantial cash injection which underwrites the development of the Sal de Vida lithium brine project. This transaction provides Galaxy maximum flexibility for the parallel process being led by J.P. Morgan, to evaluate and consider options for strategic partners for the development of Sal de Vida. We are very pleased to have developed what we see as a mutually beneficial relationship with POSCO with this transaction and look forward to dose co-operation with POSCO on our respective projects. This transadion is also economically significant as it means there are well advanced plans for two lithium projeds to be developed concurrently on the Salar del Hombre Muerto spanning across both Catamarca and Salta Provinces, which carries obvious benefits for all stakeholders in both regions in Argentina.”

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Posted By : Rabi Wangkhem on Wed, 29 Aug 2018
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