Cashed up lithium near term producer Neometals (ASX:NMT) is about to swell its cash reserves further with Jiangxi Ganfeng Lithium Co., Ltd to remit US$27.15 million after accelerating an option to acquire a further 18.1% of Reed Industrial Minerals Pty Ltd from Neometals.
Neometals is due to receive 50% of that sum, or US$13.575 million on 23 February 2016.
Completion of the sale and unconditional release of the remaining 50% of the purchase price will be finalised on 31 March 2016.
The completion arrangements were to accommodate Chinese regulatory requirements for its JV partner.
Neometals is on track to be a producer of spodumene (lithium oxide mineral) concentrate from the Mt Marion mine in Western Australia by mid-2016.
With production of concentrates on track and growing cash levels, at its current share price a significant proportion of Neometals' valuation is cash, providing for a significant undervaluation and investment opportunity at $0.22.
With nil debt and and minimal forward expenditure, Neometals has one of the highest cash levels witnessed in a near term mineral producer.
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