Primarily based on Pilbara’s final closing value, the deal implies a price of A$0.20 per Latin Assets share, a 66.7% premium to its final closing degree.
On Thursday, after the deal was introduced, shares of Latin Assets soared 56% of their largest one-day proportion achieve since April 2022.
The transaction will give Pilbara management of Latin Useful resource’s flagship Salinas lithium venture in Minas Gerais, Brazil, and publicity to the rising North American and European battery market.
“Whereas Minas Gerais is a mining pleasant jurisdiction, the problem will probably be convincing the market that diversifying into Brazil is smart with a less-than-stellar observe file from ASX miners,” analysts at Citi wrote.
Analysts at RBC Capital Markets additionally stated they see “restricted operational synergies”, with the deal being a drag on Pilbara’s earnings within the close to time period.
Pilbara’s shares fell as a lot as 6.7% on Thursday to their lowest degree since August 2022.
Latin Assets board unanimously beneficial the deal within the absence of a greater proposal.
($1 = 1.5158 Australian {dollars})
(By Sneha Kumar; Enhancing by Mohammed Safi Shamsi, Rashmi Aich and Tom Hogue)