Leo Lithium — Merger or Acquisition (April 2022)
47 slides from Leo Lithium's merger presentation, Apr 29, 2022
Slide 1: Leo Lithium Demerger & Offer Briefing
Not for release to US wire services or distribution in the United States 29 April 2022 Leo Lithium Demerger & Offer Briefing Simon Hay Managing Director
Slide 2: Important Notice and Disclaimer
DISCLAIMER IMPORTANT NOTICE AND DISCLAIMER General This presentation has been prepared by Leo Lithium (ACN 638 065 056) (Leo Lithium or the Company (a wholly owned subsidiary of Firefinch Limited (ACN 113 931 105) (Firefinch)). It contains general background information only which is current at the
Slide 3: Important Notice and Disclaimer
DISCLAIMER IMPORTANT NOTICE AND DISCLAIMER An investment Leo Lithium's securities is subject to known and unknown risks, many of which are beyond the control of Firefinch and Leo Lithium, including factors and risks specific to the industry in which Firefinch and Leo Lithium operates as well as gene
Slide 4: Demerger & Offer
1. Demerger & Offer
Slide 5: Goulamina Highlights
GOULAMINA HIGHLIGHTS Long life, large scale open pit project with development underway Among the world’s largest spodumene projects Large scale, high grade, low impurity orebody Development is underway Quality product Project location Social licence to operate Ganfeng JV partnership Exposure to the
Slide 6: Demerger Rationale
DEMERGER RATIONALE Separation of two distinct assets to create more transparent market values Logical separation of Firefinch’s Enable Leo Lithium & Firefinch to Creates a pure-play lithium lithium (Goulamina) and gold undertake more targeted developer on the ASX with (Morila) projects, allowing mar
Slide 7: Demerger and Pro-rata Offer
DEMERGER AND PRO-RATA OFFER Firefinch Shareholders1 to receive 1 Leo Lithium share for every 1.4 Firefinch shares at no cost (Demerger), plus opportunity to participate in a pro-rata priority equity raising offer (Pro-rata Offer) Demerger2 1 Leo Lithium share granted for every 1.4 Firefinch shares (
Slide 8: Demerger Overview
DEMERGER OVERVIEW Firefinch to retain a 20% shareholding in Leo Lithium Demerger Overview Post Demerger Overview ● The demerger will result in two independent ASX-listed Firefinch Limited Firefinch Limited companies – Firefinch and Leo Lithium1 (ASX:FFX) shareholders ● Firefinch shareholders will ha
Slide 9: Offer Overview
OFFER OVERVIEW Offer to raise up to a total of A$100 million at A$0.70 per Leo Lithium share • Raise a minimum of A$50 million (Minimum Subscription) and maximum of A$100 million (Maximum Subscription) for Leo Lithium under the Pro-rata Offer, Shortfall Offer and Firefinch Offer (Offer) Offer • Up t
Slide 10: Pro-rata Offer Details
PRO-RATA OFFER DETAILS Leo Lithium to raise up to A$100 million to primarily fund Goulamina’s development Key Offer Details Sources & Uses of Funds Minimum Maximum Minimum Maximum Subscription Subscription Subscription Subscription (A$50 million) (A$100 million) (A$50 million) (A$100 million) Offer
Slide 11: Stage 1 Goulamina Project capital funding
Stage 1 Goulamina Project capital funding Stage 1 Goulamina Project expected to be fully funded assuming A$100 million is raised1 • Stage 1 Goulamina Project (100% project basis) is Goulamina Stage 1 development funding waterfall (US$ million)1 expected to be fully funded assuming A$100 million is F
Slide 12: Implied market capitalisation split
Implied market capitalisation split Pro-rata Offer pricing implies a 65% attribution of Firefinch’s market capitalisation to Leo Lithium Demerger indicative market capitalisation split as at 28 April (A$m, prior to the Offer)1 ● Separation of two distinct assets 1,140 738 to provide a more transpare
Slide 13: Demerger & Offer Timetable
DEMERGER & OFFER TIMETABLE Subject to shareholder approval, Leo Lithium is expected to list in June 20221 Event Date1 Prospectus Date Friday, 29 April 2022 Record date for the Pro-rata Offer 5.00pm, Thursday, 5 May 2022 Pro-rata Offer, Shortfall Offer and Firefinch Offer opens Monday, 9 May 2022 Pro
Slide 14: Leo Lithium Overview
2. Leo Lithium Overview
Slide 15: Leadership Team
LEADERSHIP TEAM Experienced Board & Management Alistair Cowden Simon Hay Amber Banfield Chairman Managing Director Non-Executive Director Experienced mining company 30+ years’ experience with a track 20+ years’ experience in founder and builder with 41 years’ record of value creation. Simon was mana
Slide 16: Goulamina Highlights
GOULAMINA HIGHLIGHTS Long life, large scale, development-ready open pit operation 1 Globally Goulamina expected to be amongst the world’s largest spodumene projects significant project Forecast annual spodumene concentrate production of 506ktpa increasing up to 831ktpa under Stage 21 Amongst the lar
Slide 17: Goulamina: A Tier 1 Lithium Development
GOULAMINA: A TIER 1 LITHIUM DEVELOPMENT Updated Definitive Feasibility Study1 detailed a Stage 2 expansion from 2.3Mtpa to 4.0Mtpa US$2.9 billion 80% US$312/t Post-tax real NPV8% on a 100% basis2 Recovery Cash cost (FOB, LOM, dry)4 (LOM)4 Test work has resulted in 80% recovery, Expected competitive
Slide 18: Goulamina Lithium Project Key Metrics
GOULAMINA LITHIUM PROJECT KEY METRICS Two stage development plan selected in Updated DFS Updated DFS Key Metrics from December 2021 (100% project basis) Ownership Firefinch (45%), Ganfeng (45%), State of Mali (10%)1 Mineral Resource 108.5Mt at 1.45% Li2O Mine Life 21 years minimum Ore Reserves (Prov
Slide 19: World Class Partner
WORLD CLASS PARTNER Ganfeng has secured 50% of Goulamina Stage 1 offtake, and up to 100% on debt provision Ganfeng Overview Ganfeng’s Global Lithium Operations Chinese lithium chemical producer, market capitalisation of ~US$19 billion China number one lithium chemical producer by production capacity
Slide 20: Ganfeng JV Formalised
GANFENG JV FORMALISED US$130 million equity funding received ● Funds totalling US$130 million have been received by Mali Lithium BV (Goulamina JV) from Ganfeng ― Firefinch and Ganfeng each hold a 50% interest in the Goulamina JV ― Firefinch and Ganfeng will hold 45% each in the Goulamina Lithium Pro
Slide 21: Goulamina Project Status
GOULAMINA PROJECT STATUS Proceeding with early-stage engineering, drilling and site-works ● Procurement of long lead items ― Ball mill tender completed and issued to vendors ● Site works have started ― Earthworks contractor mobilisation completed end March ― Road upgrades underway ― Construction of
Slide 22: ASX hard rock peer market capitalisations
ASX hard rock peer market capitalisations Leo Lithium to be a pure-play lithium developer on the ASX Market Capitalisation (A$m)1 Producer Developer Explorer 8,008 ✓ All material permits in place to enable construction to commence ✓ Development is underway ✓ First production scheduled for H1 2024 ✓
Slide 23: Key Takeaways
KEY TAKEAWAYS A large scale spodumene concentrate operation supplying a tier 1 offtaker 1 Among the world’s largest spodumene projects 2 Large scale, high grade, low impurity orebody 3 Development is underway 4 Quality product 5 Social licence to operate 6 Ganfeng JV partnership 7 Exposure to the EV
Slide 24: Appendix A
Appendix A Supporting Information
Slide 25: Processing and Testwork Update
PROCESSING AND TESTWORK UPDATE Spodumene successfully converted into battery grade lithium hydroxide (min 99.5% Li2O) ● Revised process flowsheet to facilitate an increase in plant throughput Simplified Process Flow Design from 2.3Mtpa to 4.0Mtpa with key updates being: ― Three-stage conventional cr
Slide 26: Goulamina Resource and Reserve
GOULAMINA RESOURCE AND RESERVE Mineral Resource of 108Mt at 1.45% Li2O and Ore Reserve of 52Mt at 1.51% Li2O Goulamina Mineral Resource Estimate – 8 July 2020 Contained Classification Tonnes (m) Grade Li2O (%) Tonnes Li2O Measured 8.4 1.57 133,000 Indicated 56.2 1.48 832,000 Inferred 43.9 1.38 606,0
Slide 27: Appendix B: Key Risks
Appendix B Key Risks
Slide 28: Key Risks
KEY RISKS Introduction This Appendix B describes some of the potential risks associated with the Company’s business and the industry and markets in which the Company operates and risks associated with an investment in Shares. The Company is subject to a number of risks both specific to the Company’s
Slide 29: Key Risks: Political and security instability in Mali
KEY RISKS Political and security instability in Mali Leo Lithium’s properties in Mali may be subject to the effects of political changes, war and civil conflict, changes in government policy, lack of law enforcement, labour unrest and the creation of new laws. These changes (which may include new or
Slide 30: Key Risks: Tax
KEY RISKS Tax Pursuant to the Malian Mining Code, the Government has the right to collect tax on a direct or indirect change in control of tenements in Mali. By virtue of the existing stabilisation regime that applies to the Goulamina Lithium Project, the Company does not consider that any capital g
Slide 31: Key Risks: Commodity prices
KEY RISKS Commodity prices The Goulamina Lithium Project does not yet produce spodumene concentrate. Demand for, and pricing of, spodumene concentrate is sensitive to a variety of external factors, most of which are beyond Leo Lithium’s control. In particular, the supply and demand of spodumene conc
Slide 32: Key Risks: Production, capital and operating costs
KEY RISKS Production, capital and operating costs The value of Leo Lithium today, and the future financial performance and position of Leo Lithium, is dependent on estimates of future production and capital and operating costs. Leo Lithium’s main operating expenses are expected to be contractor cost
Slide 33: Key Risks: Labour and employment
KEY RISKS Labour and employment Relations between Leo Lithium and its employees may be affected by changes in the scheme of labour relations that may be introduced by the relevant governmental authorities in whose jurisdictions Leo Lithium carries on business. Changes in such legislation or in the r
Slide 34: Key Risks
KEY RISKS By doing business in Mali, Leo Lithium could face, directly or indirectly, corrupt demands by officials, militant groups or private entities. Consequently, Leo Lithium faces the risk that one or more of its employees, agents, intermediaries or consultants may make or receive unauthorised p
Slide 35: Key Risks: Dividend risk
KEY RISKS Dividend risk As an exploration and development company funded by shareholders, Leo Lithium currently does not pay dividends. Payments of dividends on Shares is within the discretion of the Leo Lithium Board and will depend upon Leo Lithium’s future earnings, its capital requirements, fina
Slide 36: Key Risks: Economic factors
KEY RISKS Economic factors The operating and financial performance of Leo Lithium is influenced by a variety of general economic and business conditions, including levels of consumer spending, oil prices, inflation, interest rates and exchange rates, supply and demand, industrial disruption, access
Slide 37: Key Risks: Litigation and liquidity
KEY RISKS Litigation Leo Lithium like many companies in the mining industry, is subject to legal claims in the ordinary course of its corporate and operational activities, with and without merit. Due to the inherent uncertainty of the litigation and dispute process, there can be no assurance that th
Slide 38: Appendix C: Pro-rata Offer International Offer Restrictions
Appendix C Pro-rata Offer International Offer Restrictions
Slide 39: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS This International Offering Circular does not constitute an offer of Shares in any jurisdiction in which it would be unlawful. In particular, this International Offering Circular may not be distributed to any person, and the Shares may not be offered or sold, in any
Slide 40: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS European Union This International Offering Circular has not been, and will not be, registered with or approved by any securities regulator in the European Union. Accordingly, this International Offering Circular may not be made available, nor may the Shares be offere
Slide 41: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS Liechtenstein This International Offering Circular has not been, and will not be, registered with or approved by any securities regulator in Liechtenstein or in the European Union. Accordingly, this International Offering Circular may not be made available, nor may t
Slide 42: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS Singapore This International Offering Circular and any other materials relating to the Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this International Offering Circular
Slide 43: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS United Kingdom Neither this International Offering Circular nor any other document relating to the Offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Serv
Slide 44: Appendix D: Shortfall Offer International Offer Restrictions
Appendix D Shortfall Offer International Offer Restrictions
Slide 45: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS No actions have been taken to register or qualify the Shares or otherwise permit a public offering of the Shares in any jurisdiction outside Australia. In particular, this International Offering Circular may not be distributed to any person, and the Shares under the
Slide 46: International Offer Restrictions
INTERNATIONAL OFFER RESTRICTIONS Mauritius In accordance with the Securities Act 2005 of Mauritius, no offer of Shares may be made to the public in Mauritius without the prior approval of the Mauritius Financial Services Commission. Accordingly, an offer of Shares is being made on a private placemen
Slide 47: For more information
For more information Simon Hay Managing Director [email protected] leolithium.com