RNS Number : 7267C
Zinnwald Lithium PLC
22 June 2021
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the UK Market Abuse Regulation.
With the publication of this announcement, this information is now
considered to be in the public domain.
Zinnwald Lithium plc / EPIC: ZNWD.L / Market: AIM / Sector:
22 June 2021
Zinnwald Lithium plc ("Zinnwald Lithium" or the "Company")
Secures Full Ownership of Advanced, High Value Lithium Project
Zinnwald Lithium plc, the German focused lithium development
company, is pleased to announce that it has entered into a binding
agreement to acquire the 50 per cent. of Deutsche Lithium GmbH
("Deutsche Lithium") that it does not already own for a total
consideration of EUR8.8 million to be settled with a cash payment
of EUR1.5 million and the issue of approximately 50 million new
ordinary shares of 1 pence each ("New Ordinary Shares") (the
"Acquisition"). Deutsche Lithium is developing the advanced
Zinnwald Lithium Project in Germany ("Zinnwald" or the "Project").
The Acquisition gives the Company full ownership and operational
control of the Project and is in line with its corporate objective
to become a key supplier to the European lithium market.
-- Key transaction terms:
o Acquisition of 50 per cent. of Deutsche Lithium from the
estate of SolarWorld Aktiengesellschaft (in administration)
resulting in the Company increasing its holding in Deutsche Lithium
to 100 per cent.
o Purchase consideration of EUR1.5 million in cash and
approximately 50 million New Ordinary Shares. There will not be an
o 23,809,916 New Ordinary Shares subject to lock-in
-- The Acquisition will enable the Company to advance the
Project and benefit from its significant economic and strategic
o Integrated design: able to produce a suite of value-added
downstream battery-grade lithium products
o Long mine life: 30 years equating to < 50% of the current
identified mineral resources
o Advanced: Completed Feasibility Study; approved mining licence
valid to 2047
o Experienced team: project management team based in Germany and
skilled labour available
o Excellent location: lies in the heart of the European chemical
and automotive industries
-- Robust market fundamentals with potential for a six-fold
increase in demand for lithium estimated by 2030 as EV (electric
vehicle) adoption increases and battery sector expands
-- Strategy is to advance the Project, in line with this,
several workstreams are ongoing / planned:
o Continued engagement with potential off-take partners
o Performing testwork to assess the commercial viability of
producing a broader range of lithium compounds
o Undertaking front-end engineering design work
o Finalising the selection of the optimal chemical processing
o Advancing the permitting process
Zinnwald Lithium CEO, Anton du Plessis, commented: "When we
created Zinnwald Lithium via the Reverse Takeover of a 50 per cent.
interest in Deutsche Lithium in October 2020, one of our stated
strategic objectives was to consolidate ownership of the late-stage
Zinnwald Lithium Project. The Acquisition announced today fulfils
this objective, giving us full ownership and operational control of
the Project, which significantly enhances our ability to optimise
and progress it at our own pace.
"We believe that the Project offers an attractive entry point
into the rapidly developing battery metals sector as one of the
more advanced European lithium projects. W e look forward to
advancing the Project and keeping shareholders updated."
Details of the Acquisition
The key terms of the proposed Acquisition are set out below:
-- Zinnwald Lithium has entered into a sale and purchase
agreement with Mr Horst Piepenburg (acting in his capacity as
insolvency administrator over the estate of SolarWorld
Aktiengesellschsaft) (the "Administrator") for the acquisition of
the remaining 50 per cent. of the share capital of Deutsche Lithium
that it does not already own.
-- Following the Acquisition, Zinnwald Lithium will own 100 per
cent. of the share capital of Deutsche Lithium resulting in the
Company having full operational control of the Project.
-- The Acquisition consideration is to be satisfied through the
payment of EUR1.5m (GBP1.3 million) to the estate of SolarWorld
Aktiengesellschaft (in administration) in cash from the Company's
existing cash resources, together with the issue of 49,999,996 New
-- The sale and purchase agreement contains very limited
warranties between Zinnwald Lithium and the Administrator,
reflecting both the Company's existing knowledge of Deutsche
Lithium and the nature of the role of the Administrator.
-- On completion of the transaction, the New Ordinary Shares
will be distributed pro-rata to creditors of SolarWorld
Aktiengesellschaft with secured interests in the 50 per cent. of
the share capital of Deutsche Lithium that are subject to the
acquisition. The secured creditors consist of SolarWorld
Aktiengesellschaft's term loan lenders and the creditors of the two
notes issued by SolarWorld Aktiengesellschaft and represented by
G&P GmbH & Co. KG (ISINs DE000A1YCN14) and Mr. Alexander
Elsmann (ISIN DE000A1YDDX6) as joint representatives.
-- Recipients of New Ordinary Shares representing a combined
total of 31,746,554 New Ordinary Shares have entered into lock-in
arrangements with the Company giving an undertaking that for a
period of three months from completion of the Acquisition they will
retain at least 75 per cent. of their New Ordinary Shares (being
23,809,916 shares) and for a period of six months from completion
of the Acquisition they will retain at least 50 per cent. of their
New Ordinary Shares.
Unaudited financial information for the year ended 31 December
2020 shows that Deutsche Lithium generated losses of EUR0.24m,
reflecting the development phase of its underlying assets. Total
assets as at 31 December 2020 were EUR8.25m.
Following the Acquisition, Zinnwald Lithium will no longer treat
its shareholding in Deutsche Lithium as an investment in an
associate but will consolidate Deutsche Lithium in its entirety
within Zinnwald Lithium's group accounts.
On Admission (as defined below), the Company will have a market
capitalisation of approximately GBP31.9 million, based on the
closing mid-market price of 12.5 pence of an Ordinary Share on 21
June 2021. Post completion of the Acquisition, the Company will
have cash on hand of EUR2.7 million.
Issue of equity and change to total voting rights
Application has been made for the 49,999,996 New Ordinary Shares
to be admitted to trading on AIM ("Admission") and it is expected
that Admission will occur on or around 24 June 2021.
Upon Admission, the Company's issued share capital will consist
of 255,105,953 Ordinary Shares with one voting right each. The
Company does not hold any ordinary shares in treasury. Therefore,
the total number of ordinary shares and voting rights in the
Company will be 255,105,953. With effect from Admission, this
figure may be used by shareholders in the Company as the
denominator for the calculations by which they will determine if
they are required to notify their interest in, or a change to their
interest in, the share capital of the Company under the FCA's
Disclosure Guidance and Transparency Rules.
For further information visit www.zinnwaldlithium.com or
Anton du Plessis Zinnwald Lithium plc email@example.com
Allenby Capital Limited +44 (0) 20 3328
David Hart/Liz Kirchner (Nominated Adviser) 5656
Turner Pope Investments
(TPI) Ltd +44 (0) 20 3657
James Pope/Andy Thacker (Broker) 0050
Isabel de Salis/Frank St Brides Partners (Financial firstname.lastname@example.org
Zinnwald Lithium plc (EPIC: ZNWD.L) is an AIM quoted, German
focused lithium development company focussed on becoming an
important supplier to Europe's fast-growing battery sector. On
completion of this transaction, the Company will own 100% of the
Zinnwald Lithium Project in Germany, a late-stage development
project with attractive economics and approved mining licence. The
Project is located in the heart of Europe's chemical and automotive
industries and has the potential to be one of Europe's most
advanced battery grade lithium projects.
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(END) Dow Jones Newswires
June 22, 2021 07:02 ET (11:02 GMT)
Zinnwald Lithium (LSE:ZNWD)
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