China Africa Resources to take minority stake in US Lithium

Natural resource exploration and development company China Africa Resources announced on Wednesday that it has signed an Investment Agreement with US Lithium, a private Australian company, to acquire up to a 47.5% shareholding in USL.

The AIM-traded firm said USL has interests in lithium exploration licences in Arizona and New Mexico, held through a 100% owned subsidiary company registered in the US.

Its board claimed the transaction would not constitute a reverse takeover under the AIM rules, and as a result China Africa would need to continue to seek to complete a reverse takeover or face suspension from trading on AIM.

“I am pleased to announce this second investment which continues to build the China Africa business model, this time with the addition of lithium exploration and development interests in the secure operating environment of the United States,” said CEO Paul Johnson.

“The funds from the initial investment by CAF will be used directly to fund a follow-up exploration programme which the US Lithium team are currently finalising.

“This planned work will generate systematic exploration data to further the knowledge of the four projects and will seek to qualify the exploration targets in advance of any future drilling programme.”

Johnson said the historic exploration data from all four projects was encouraging, and the presence of the historical lithium and tantalum workings in the New Mexico Project were particularly interesting.

“We look forward to relaying the findings from the US Lithium programme and related material developments as they occur.

“China Africa will continue to investigate further opportunities and has a number under advanced review.

“There of course can be no certainty that any commercial transactions will be undertaken until crystallised and published via regulatory announcement.”