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Prospect Resources closes sale of Arcadia lithium project to Zhejiang Huayou

Prospect plans to use between $22.2 and $29.7m secured from the stake sale, for battery and electrification metals projects.
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This article was originally published by Mining Technology

Australia’s battery minerals company Prospect Resources has closed the sale of its 87% interest in the Arcadia project in Zimbabwe, to a subsidiary of China’s Zhejiang Huayou Cobalt, for $377.8m.

Prospect received $342.9m in proceeds on the closure of the deal after the payment of $26.8m in Zimbabwean capital gains taxes, and $8m to Sinomine for the termination of the offtake agreement between Prospect and Sinomine.

Prospect managing director and CEO Sam Hosack said: “Huayou’s pedigree as a leading electric vehicle battery precursor producer opens up opportunities in Zimbabwe and supports our strategy both in Zimbabwe and the broader sub-Saharan region.

“The transaction, being the culmination of years of effort progressing and developing the Arcadia Project to this point is a testament to the skills and expertise of the Prospect team, who are now firmly focussed on the path ahead, to build the next iteration of Prospect, a developer of lithium and battery and electrification metals projects.”

Prospect plans to distribute a considerable portion of the proceeds raised from the stake sale to its shareholders.

Furthermore, the firm plans to fund between $22.2m (A$30m) and $29.7m (A$40m) for battery and electrification metals projects with a primary focus on Zimbabwe, and secondary on the sub-Saharan African region.

In December 2021, Zhejiang agreed to purchase a 100% stake in the Arcadia hard-rock lithium mine in Zimbabwe from Prospect Lithium Zimbabwe.

Located near Harare, the Arcadia project is considered one of the world’s biggest hard rock lithium resources.

The post Prospect Resources closes sale of Arcadia lithium project to Zhejiang Huayou appeared first on Mining Technology.

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Author: Archana Rani

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