Zijin Mining’s C$960 Million Acquisition of Neo Lithium

Paradigm Capital is acting as financial advisor to Zijin and Torys LLP is acting as Zijin’s legal counsel. Fasken Martineau DuMoulin LLP is acting as legal counsel to Neo Lithium and the Special Committee. BofA Securities is acting as financial advisor to Neo Lithium. Cormark Securities provided an independent fairness opinion to the Neo Lithium board of directors and the Special Committee.

On October 8, 2021, Zijin Mining Group Co., Ltd. and Neo Lithium Corp. entered into a definitive agreement, pursuant to which Zijin agreed to acquire all of the outstanding shares of Neo Lithium at a price of C$6.50 per share in cash, for total cash consideration of approximately C$960 million.

The Arrangement Agreement includes, among other things, a customary non-solicitation covenant on the part of Neo Lithium (including fiduciary out provisions) and a right for Zijin to match any competing offer that constitutes a superior proposal. Under certain circumstances, Zijin would be entitled to a US$35 million termination fee and Neo Lithium would be entitled to a US$35 million reverse termination fee.

The transaction will be completed pursuant to a plan of arrangement under the Business Corporations Act (Ontario). The transaction is expected to close in the first half of 2022. In addition to approval of at least 66 ?% of the votes cast by shareholders at a shareholders meeting expected to take place in December 2021, the transaction is also subject to receipt of certain government, regulatory, court and stock exchange approvals, including approval by relevant authorities in the People’s Republic of China and Investment Canada Act approval.

Formed in 1993 and based in Fujian, China, Zijin is one of the largest mining companies in China as well as a leading global gold and copper producer.

Neo Lithium has become a prominent name in lithium brine development and is advancing its 100% owned 3Q project – a unique high-grade lithium brine lake and salar complex in Latin America’s “Lithium Triangle”.

The Torys’ team was led by Mike Amm (Picture) and Josh Lavine, and included Carly Klinkhoff, Melissa Lowy and Hannah Atkinson (corporate/M&A), Omar Wakil (foreign investment review), Craig Maurice and Steve Marshall (tax).

Involved fees earner: Steve Marshall – McCarthy Tétrault; Michael Amm – Torys LLP; Carly Klinkhoff – Torys LLP; Josh Lavine – Torys LLP; Melissa Lowy – Torys LLP; Craig Maurice – Torys LLP; Omar Wakil – Torys LLP;

Law Firms: McCarthy Tétrault; Torys LLP;

Clients: Zijin Mining ;

Author: Sonia Carcano