Lithium now seems to be the flavor of the month, and Wealth Minerals (WML.V) is determined to gain exposure to the commodity as it has entered into an agreement whereby it would acquire Li3 Energy (LIEG) which owns a 49% stake in Minera Li Energy, a Chilean company. Minera Li owns a 60% stake in the Litio 1-6 concessions as well as a 100% interest in the Cocina 19-27 claims in Chile. On top of that, Li3’s existing partnership with POSCO (PKX) and the exposure to the Maricunga lithium project could be worth a lot as well.
Wealth will have to arrange a C$3M financing before completing the transaction, where after a merger of equals will occur whereby both Wealth and Li3 shareholders will own 50% of the consolidated entity.
With this potential addition of a Lithium asset to its portfolio, Wealth is getting its fingers in a lot of pies and this diversification could prove to be very valuable during the next cycle in the commodity prices.
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The author holds a long position in Wealth Minerals. Please read the disclaimer
