Investors were eagerly awaiting AVZ shares to resume trading today after a trading halt on Monday, however this was not the case after the shares were suspended from ASX trading.
This morning AVZ requested:
“The voluntary suspension is requested in connection with the finalisation and release of an announcement in relation to its mining and exploration rights for the Manono Lithium and Tin Project. The Company anticipates that it will be able to make an announcement on this matter by commencement of trading on Friday, 20 May 2022.”
Currently, AVZ owns a 75% stake and La Congolaise D’Exploitation Miniere SA (Cominiere) owns the remaining 25% stake.
For the price of a US$240 million investment to fund the development of the project, AVZ intends to provide a 24% stake to Suzhou CATH Energy Technologies for a joint venture opportunity.
AVZ believes it now has the rights to acquire Cominiere’s remaining 15% stake, which would bump its overall share of the project back to 66%. However, Cominiere has thrown a spanner into the works by selling it to a third-party which is the Jin Cheng Mining Company.
AVZ logically aims to dispute this claim in order to increase their ownership of the Manono project.
The Company commented:
“…As previously disclosed to ASX on 4 May 2021, any purported transfer of the 15% interest to Jin Cheng would be a material breach of the pre-emptive rights contained in the existing Dathcom Shareholders Agreement, invalid and of no force or effect. The Company is considering the request for arbitration and related correspondence and will continue to take all necessary actions to resist Jin Cheng’s vexatious and meritless claims and to protect Dathcom’s and its interests.”
Only time will tell which way the court will decide for AVZ’s rights battle.