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Shares of Trident Royalties PLC (LON: TRR) after the company announced the proposed acquisition of a 60% interest in the existing gross revenue royalty over the Thacker Pass Lithium Project in the United States.
The royalties company acquired the royalties for a total of $28 million. Trident has raised £20.2 million (approx. US$28.1 million) via a conditional share placement to fund the acquisition. The new shares were priced at 34p each.
The Thacker Pass project is the largest lithium reserve in the United States. The royalty agreement is subject to a partial operator buy-back which Trident expects will be exercised by the operator, LAC, for proceeds of up to US$13.2 million.
Trident noted that once the acquisition is completed, it shall have significant exposure to the growing lithium market amid rising lithium prices driven by the surge in demand for the metal used in most modern batteries.
The project is operated by Lithium Americas Corp (NYSE: LAC), an experienced lithium project develop with a market capitalisation of $2 billion. The project is well funded after raising $500 million in January this year.
Adam Davidson, Trident’s CEO, commented: “The Thacker Pass lithium royalty will be the twelfth, and by far the largest, royalty acquisition announced in Trident's first ten months since being admitted to trading on AIM. I am delighted to have been able to secure a royalty over such as significant asset with a clear development pathway. Thacker Pass, which will become a cornerstone asset for Trident, will bring the addition of lithium, a key battery metal, to our portfolio alongside existing exposure to iron ore, copper and gold.”
Trident Royalties share price.
Trident Royalties shares rallied 11.11% to trade at 38p after rallying from Thursday’s closing price of 34.2p.
Should you invest in Trident Royalties shares? Trident Royalties shares are traded on the AIM market of the London stock exchange (the alternative investment market) which is the submarket specifically for smaller companies. AIM stocks are attractive to investors as they have tax advantages and smaller companies have the potential to benefit from rapid growth. But are Trident Royalties shares the best buy? Our stock market analysts regularly review the market and share their picks for high growth companies
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