Atlantic Lithium is facing the prospect of another bid after major shareholder Assore increased its stake to 28.4% yesterday.
Assore has already had two approaches to Atlantic at 33p a share rejected by the lithium group’s board but SP Angel believes this latest acquisition of shares heralds a new attempt.
“We strongly suspect Assore is preparing to take another run at Atlantic Lithium and might be preparing to become a more significant player in lithium production and processing.
“UK investors are concerned that Assore might breach 30%, though UK takeover provisions do not apply in this case. Assore has bought the maximum that the 3% creep provision will allow every 6 months.”
Piedmont said it sold the stake to Assore for US$7.8m to “bolster its cash balance”, which SP Angel suggests is being used up rapidly to support its North America Lithium joint venture.
After the sale, Piedmont’s stake in Atlantic drops to 5.2% though it said the disposal will have no impact on the pair's joint venture at Ewoyaa in Ghana, its earn-in status or offtake arrangements.
Assore is a South African-based mining group with extensive experience in Africa.
Shares in Atlantic dropped 0.2% to 21.7p.