RE:RE:RE:RE:Yes!!!Hi dmacd,
Good summary, I compeltely agree with your acessment.
In the grand scheme, the Rheominerals will be nothing in comparison with LAC's lithium. Since the clay is in a loss business since they start operation. I believe they should just shut down its operation, or sell it. Since they get their clay from the lithium, it will make sense to sut down until lithium operation starting.
It is good to have healthy discussions, rather than pointing figers, name calling.
tiger
dmacd wrote: Rheominerals needs to be fixed or sold and it will be. However, it is meaningless in terms of investing in LAC. Who cares about Rheominerals in the long run. Why focus on Rheominerals when the big news is the valuation of the project.
50/50 partnership is also unusual in that the GOV position becomes the swing voter. Either party plus GOV will control major decisions although so far LAC and Gangfeng have shown to be excellent partners. Gangfeng will ideally be the operator moving forward.
Gangfeng bought 12.5% of the JV for $160M so that values the project at $1.28 billion of which LAC owns 50% or $614M. LAC market cap is $330M SP + $300M Debt - $160M Cash = $470M. There is 40% more upside in the SP at current values vs insider Gangfeng paid in this transaction.
LAC may sell another 15% once production is on stream to fund their early stages of the US project, and to avoid being overleveraged while Ph 2 decisions are made. My speculation.
Gangfeng might take a small stake in that project as well if they remain bullish on Lithium in the long run and want a US presence but too early for that just now. Environmental approval will need to be obtained before that can happen. My speculation.