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European Lithium (ASX:EUR) merges with Sizzle to form Critical Metals Corp – The Market Herald

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  • European Lithium (EUR) will merge with US special purpose vehicle Sizzle Acquisition to form lithium exploration and development company Critical Metals Corp.
  • As part of the merger, the company will sell its stake in its Wolfsberg lithium project in Vienna for US$750 million (A$117 million) in Critical Metals shares.
  • Upon completion, the company will own approximately 80 percent of the combined entity, providing the group with capital of approximately US$159 million
  • Shareholders are expected to approve the deal on November 30, and if approved, the company expects to list Critical Metals on NASDAQ in the first half of 2023.
  • Euro shares ended the day up 7.78 percent to close at 9.7 cents

European Lithium (EUR) will merge with US special purpose vehicle Sizzle Acquisition to form lithium exploration and development company Critical Metals Corp.

The merger will see the company sell its wholly-owned stake in the Wolfsberg lithium project in Vienna, Austria, for US$750 million (A$117 million) in Critical Metals shares.

After the transaction closes, the company will own approximately 80 percent of the combined company.

The transaction is expected to provide the combined group with approximately US$159 million in capital, excluding the cost of financing the operations of Critical Metals Corp.

In addition, the expected capital will allow Critical Metals to continue construction and development in Wolfsberg.

As part of the agreement, the company confirmed a fee of US$5 million, which it must pay if EUR decides not to proceed with the deal if it finds a better offer.

Commenting on the deal, EUR executive chairman Tony Sage said the newly merged company would be able to achieve the company’s commercial goals in Wolfsberg by 2025.

“Wolfsberg is poised to become the first major source of lithium concentrate for batteries in Europe, the world’s leading market for electric vehicles, capable of producing approximately 200,000 electric vehicles per year,” he said.

“The funds raised through this transaction will provide us with the resources we anticipate will be needed to advance the construction and commissioning of Wolfsberg.”

The project is the company’s main advanced lithium project, 270 kilometers southwest of Vienna.

The company reported total measured, indicated and inferred mineral resources of 12.88 million tonnes at one percent lithium oxide grade, confirming its potential to be a globally significant hard rock lithium project.

In April 2018, a positive pre-feasibility study was received from Wolfsberg, confirming the decision to proceed with the commissioning of the final feasibility study (DFS), which is scheduled to be delivered in the first quarter of 2023.

EUR has confirmed that it will continue to be listed on the ASX as a mining company and its primary focus remains on advancing the project to development.

Shareholders are expected to approve the deal on November 30, and if approved, the company expects to list Critical Metals on NASDAQ in the first half of 2023.

Shares in European Lithium ended the day up 7.78 percent to close at 9.7 cents.

https://themarketherald.com.au/european-lithium-asxeur-to-merge-with-sizzle-to-form-critical-metals-corp-2022-10-26/

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