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Long a buy and hold investor, I now believe that buy and hold has to be re-evaluated in a world of ever increasing, instant information and huge gyrations in markets all over the world. A value investor at heart, I anchor my portfolio with conservative funds and blue chip dividend stocks, but... More
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  • Update on Salares Lithium/Talison merger! 2 comments
    Jul 28, 2010 7:06 PM | about stocks: SQM, LACDF, LITHF, LIT
    Salares Lithium stock holders will double their money as Talison Lithium of Australia swallows Salares.
    AdviceImage by laughlin via Flickr
    This is an update for those of you who took my advice and bought Salares Lithium in early July for around .60 cents per share. While their is a current hold on trading this stock (LIT-TSX-v) it is by no means a time to worry.  It is a time to rejoice, because you have just doubled your money, at the very least.  Here's why!

    Talison Lithium is currently a privately owned company in Australia, producing lithium carbonate and shipping into the Chinese market from two operating production sites. In fact, it is the largest supplier of lithium into China at present.

    Talison and Salares are merging into what will be one of the largest lithium producers on the planet, and the "only pure lithium production company" to be listed on the TSX (not the venture exchange). that will occur on Sept 17th.

    I have spoken with Salares CEO Todd Hilditch and company consultant, Matt Johnston who assures me that the new company (he will provide the stock symbol in the next few days) will strike somewhere between $3.50 and $4 per share when it is launched on TSX in September. At that time, Salares share holders will own 1 share of the new entity for every 2.81 shares they hold of Salares Lithium (LIT-TSXv)

    With a price cap between $340M and $350M, this equates to approximately 35.6 % of the new entity will be owned by current Salares shareholders which should return approx $1.25 per share, or more to those of you who took my advice 3 weeks ago.

    If the TSX-v allows trading in Salares over the next few weeks, I will not part with many of my own shares. (of course I will take profit on a portion - maybe 15-20%) as I see this as a strong, bullish move for our holdings. The new company will be the only lithium producer listed on the TSX at a time when the electric car market is gaining momentum, and new lithium ETF's (NYSEARCA:LIT), are popping up on the NYSE.

    This new company will have to be included in these ETF's, as a front runner in the lithium space supplying the huge Chinese market and developing the huge Salares 7 project that Salares Lithium brings to the merger table.

    When I first posted on Salares Lithium I speculated that SQM (NYSE:SQM) of Chile may make a play for Salares, however it is Talison of Australia that has picked up this gem for it's future projects. Put Sept 17th on your calendar to pick up some shares in the new company before the ETF's do. We already have.


    Disclosure: own LIT-TSXv
    Stocks: SQM, LACDF, LITHF, LIT
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Comments (2)
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  • boulay365
    , contributor
    Comments (138) | Send Message
    Yea baby! Good Morning 17th of September!
    17 Sep 2010, 05:04 AM Reply Like
  • Retirefund
    , contributor
    Comments (770) | Send Message
    Author’s reply » UPDATE: Sept 17th
    Salares shareholders have approved the merger with Talison by a 99.9% vote.
    The hearing for the final court order to approve the Arrangement is scheduled to take place on September 21, 2010, with the completion of the Arrangement expected to occur on or about September 22, 2010. The TSX has conditionally approved the listing of the Talison ordinary shares under the symbol "TLH", and trading is expected to commence on the TSX at the market open on Thursday, September 23, 2010.


    Mark it on your calendar. It will be a busy opening day.
    18 Sep 2010, 08:11 PM Reply Like
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