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Lithium Americas closes US$172M funding deal with Jiangxi Ganfeng unit

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Lithium Americas closes US$172M funding deal with Jiangxi Ganfeng unit

Lithium Americas Corp. said June 7 that it has closed a US$172 million funding deal with Jiangxi Ganfeng Lithium Co. Ltd.'s GFL International Co. Ltd. unit, making the Chinese firm the largest Lithium Americas shareholder with a 19.9% stake.

The funding agreement, announced in January, comprised the sale of 75 million common Lithium Americas shares at 85 Canadian cents each, totaling US$47 million to the Chinese firm, and a US$125 million credit facility.

Apart from the placement and credit facility, the deal also covers an off-take agreement for the purchase and sale of lithium products.

According to Lithium Americas CEO Tom Hodgson, the closing of the investment agreement places the company in a strong financial position and will allow for the start of construction at its Cauchari-Olaroz lithium joint venture in Argentina with Sociedad Quimica y Minera de Chile SA.

A definitive feasibility study for the first stage of the Cauchari-Olaroz project estimated a construction CapEx of US$425 million, with payback in three years and five months.