Zijin Mining to acquire Neo Lithium Corp. in offer of all cash

All amounts of money are expressed in Canadian dollars unless otherwise stated.

TORONTO and FUJIAN, China, October 8, 2021 / CNW / – Zijin Mining Group Co., Ltd. (“”Zijin“) (SSE: 601899) (SEHK: 2899) and Neo Lithium Corp. (“Neo lithium“or the”company“) (TSXV: NLC) (OTCQX: NTTHF) (FSE: NE2) are pleased to announce that they have reached a final agreement (“Event agreement“), according to which Zijin has agreed to acquire all the outstanding shares in Neo Lithium (“Transaction“) at a cost of C $ 6.50 pr. stock (“Offer price“) in cash. The offer price represents a premium of approximately 36% compared to Neo Lithium’s 20-day volume-weighted average price (“VWAP“) as on October 8, 2021 on the TSX Venture Exchange (“TSXVThe total cash consideration for the entire outstanding equity in Neo Lithium is approx. $ 960 million.

Waldo A. Perez, President and CEO of Neo Lithium, stated:

“After a thorough strategic process, we are very pleased to be able to offer this cash prize offer to our shareholders from a leading global mining company. This is the result of the collective work of our leading lithium brine exploration team, which started from first discovery at the end of 2015 to define one of the largest and highest quality lithium brine deposits in the world and culminate with this premium offering in just six years.We believe it is now time for our project to move on to the construction and production phases with Zijin, a leader with a track record for developing assets responsibly with respect for the interests of local employees, communities and authorities. “

Chen Jinghe, Chairman of Zijin, stated:

“Neo Lithiums 3Q lithium brine project in Catamarca, Argentina is one of the largest and tallest projects of its kind in the world. We would like to express our great respect for the management and the professional team that discovered and successfully explored this project. The 3Q project represents an important addition to Zijin’s growing global asset mix, and it is a good choice for Zijin to enter the field with new energy minerals. Thanks to the efforts and input of the professional team in the early stages of the project, we are confident that together with Zijin’s strong financial resources and mining knowledge, we will develop this excellent asset into one of the world’s leading lithium carbonate producing mines. In line with Zijin’s ambitions for co – development, we will continue to work closely with communities and public authorities so that all relevant stakeholders can benefit from the successful development of the project “.

Zijin is committed to maintaining the current management and professional team of LIEX SA, Neo Lithium’s local operating subsidiary, as well as contributing to the economic and social development of the province of Catamarca, Argentina, as it moves forward to promote the development of the 3Q project.

Benefits for Neo Lithium shareholders

  • Immediate and significant premium of approximately 36% for the 20-day VWAP on the TSXV
  • All cash offers that are not subject to a financing condition
  • Strong security agreement with a highly credible and leading global mining company as purchaser
  • Voting agreements entered into with all directors and senior executives of Neo Lithium, which owns shares
  • Eliminates future risk of dilution, raw material, design, production and execution with the next phase of the 3Q project

Transaction overview

The transaction is carried out according to a plan of arrangement below Business Act (Ontario). The transaction is subject to the approval of at least 66 â…”% of the votes cast by the shareholders. In addition to shareholder approval, the transaction is also subject to the receipt of certain approvals from the government, legislation, court and stock exchange, including approval from relevant authorities in People’s Republic of China and the Investment Canada Act approval and other closing conditions customary in transactions of this kind.

The event agreement includes, among other things, a customary non-solicitation pact from Neo Lithium (including trust terms) and a right for Zijin to match any competing offer that constitutes a superior proposal. Under certain circumstances, Zijin would be entitled to one $ 35 million termination fee and Neo Lithium would be entitled to one $ 35 million reverse termination fee.

Neo Lithium Board of Directors Recommendations

The transaction was unanimously approved by the Board of Directors of Neo Lithium following the unanimous recommendation of a special committee of independent directors of Neo Lithium (“Special selection“). Cormark Securities has issued an opinion to the Board of Directors of Neo Lithium and to the Special Committee stating that the remuneration offered to Neo Lithium shareholders in accordance with and without prejudice to the assumptions, limitations and qualifications given herein to the Transaction is fair, financially to the Neo Lithium shareholders.Cormark Securities fairness statement was given at a fixed fee and is not conditional on the outcome of the Transaction.

Timing

Full details of the transaction will be included in Neo Lithium’s circular with management information, which is expected to be sent to shareholders in November 2021 where the shareholders’ meeting is expected to take place in December 2021. Shareholders are encouraged to read the information circular when it is available, as it will contain additional important information about the transaction. The event agreement is also submitted on SEDAR. The transaction is expected to close in the first half of 2022.

Advisors and advisor

Paradigm Capital acts as financial advisor to Zijin, and Tory’s LLP acts as Zijin’s legal advisor.

BofA Securities acts as financial advisor to Neo Lithium. Cormark Securities issued an independent fairness opinion to the Neo Lithium Board of Directors and the Special Committee. Fasken Martineau DuMoulin LLP acts as legal advisor to Neo Lithium and the Special Committee.

About Neo Lithium Corp.

Neo Lithium Corp. has quickly become a prominent name in lithium brine development thanks to its high quality 3Q project and experienced team. Neo Lithium is rapidly developing its 100% owned 3Q project – a unique high quality lithium brine and salar complex in Latin America “Lithium Triangle”.

The 3Q project is located in the province of Catamarca, the largest lithium-producing area in Argentina covers approximately 35,000 ha including a wage complex of approximately 16,000 ha.

Additional Information about Neo Lithium Corp. are available on SEDAR at www.sedar.com under the company profile and on its website at www.neolithium.ca, including various images of ongoing work on the project.

About Zijin

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. It manages an extensive portfolio, primarily consisting of gold, copper, zinc and other metals through investments in China and twelve overseas countries across Europe, Central Asia, Africa, Oceania and South America. Listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange, Zijin has a market capitalization of approx. $ 40 billion.

Neither TSX Venture Exchange nor the regulatory service provider (as this term is defined in TSX Venture Exchange’s policies) assumes responsibility for the adequacy or accuracy of this press release.

Precautionary statements regarding forward-looking statements

Forward-Looking Statements- Certain information in this press release may contain forward-looking statements. Such statements include, but are not limited to, statements about the benefits of the transaction to the Company’s shareholders, the expected date of meeting and issuance of the information circular regarding the meeting, the time of completion of the transaction and receipt of required regulatory and court approvals, expectations of Zijin’s continue operations and benefit the region, promote the 3Q project, the economic impact of the 3Q project and future plans and objectives for the company and Zijin. In general, forward-looking statements can be identified using words such as “plans”, “expect” or “expected”, “planned”, “estimates”, “intend”, “anticipate”, “believe” or variations of such words and phrases or statements, as certain actions, events or results “may”, “may”, “could”, “would”, “should”, “perhaps” or “will”, occur or be obtained, or negative connotations thereof. These forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the Company’s control, which may result in the Company’s and / or Zijin’s actual results, performance or performance being materially different from the future results, performance or performance expressed or implied by such statement. These risks include, without limitation, risks associated with obtaining regulatory and judicial approval for the transaction, political and regulatory risks associated with mining and exploration activities, including environmental regulation, risks and uncertainties related to the interpretation of drilling and test results, risks related to the uncertainty of estimation of costs and time and the potential for unexpected delays, costs and expenses, risks associated with fluctuations in metal prices, the market for lithium products and other risks and uncertainties related to the company’s prospects, properties and business described elsewhere in the company’s disclosure form. Although the Company believes that its expectations are based on reasonable assumptions and has sought to identify important factors that may cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that causes actions, events or results that should not be as expected, estimated or intentional and unnecessary dependence should not be placed on forward-looking statements.

SOURCE Neo Lithium Corp.

Additional information: Neo Lithium Corp., Carlos Vicens, [email protected]

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