(Yicai) May 7 -- Huayou Cobalt, a Chinese producer of lithium battery materials, said it plans to invest USD210 million to fully acquire Atlantic Lithium, the Australian owner of the Ewoyaa lithium mine in Ghana.

Huayou Cobalt has signed the Scheme Implementation Deed for the privatization of assets and related agreement attachments with Atlantic Lithium to acquire all of its assets, including all issued and to be issued equity as well as unlisted subscription warrants, the Tongxiang-based company announced early today.

Ewoyaa is located in central Ghana, about 110 kilometers from the port of Takoradi, Huayou Cobalt said. According to the standards of the Joint Ore Reserves Committee, the mine has a lithium oxide grade of 1.24 percent, equivalent to 1.13 million tons of lithium carbonate equivalent, consisting of 125,000 tons in proven resources, 799,000 tons in indicated resources, and 199,000 tons in inferred resources, it noted.

The deal is pending approval at a shareholders meeting of Atlantic Lithium, as well as by the Economic Community of West African States and regulators in Ghana, Australia, and China, Huayou Cobalt pointed out. Senior executives at the target company and its subsidiaries will unconditionally resign after the deal is closed, it said.

Huayou Cobalt will take an important step in deepening its overseas resource layout, enhancing its self-sufficiency rate of lithium resources and the security and resilience of the supply chain, and improving its comprehensive competitiveness through the deal, which may have a positive impact on its future financial position and operating results, it pointed out.

Atlantic Lithium obtained the mining lease for Ewoyaa in October 2023, which was approved by the Parliament of Ghana this March, becoming the first lithium mine mining lease to be approved and ratified by the parliament, Huayou Cobalt noted. The Australian firm was in the red in the fiscal year ended March due to no mining activities having commenced yet, it added.

Atlantic Lithium is listed on the Alternative Investment Market of the London Stock Exchange, the Australian Securities Exchange, and the Ghana Stock Exchange. Its largest shareholder is Assore International Holdings with a 26 percent stake, while it counts the Ewoyaa mine as its core asset, Huayou Cobalt said.

Shares of Huayou Cobalt [SHA: 603799] closed up 0.3 percent at CNY68.20 (USD10.01) apiece in Shanghai today, after earlier jumping by as much as 4 percent. Atlantic Lithium [ASX: A11] rose 12.5 percent to 32 Australian cents (23 US cents) during the Australian Securities Exchange's morning trading session, bringing its market capitalization to AUD224 million (USD162.4 million).

Editor: Martin Kadiev