Long wait continues for Galaxy
The long wait continues for Galaxy Resources shareholders to discover if the company has been successful in offloading its troubled Chinese processing plant.
Shares in the company have been suspended for the past month while the plant's prospective buyer Sichuan Tianqi Lithium Industries beds down shareholder and regulatory approvals for the sale to go ahead.
Galaxy reported on February 2 that it would accept a lower consideration for the plant after Tianqi baulked at the $US230 million price it agreed to pay back in April last year.
The new agreed price was $US173.2 million.
Under the revised terms, Tianqi would meet 50 per cent of the plant's running costs from February 1 until the transaction settled.
Tianqi would still assume all debt associated with the plant and Galaxy would be left with a cash balance of $50 million.
However Galaxy said today the deal was still subject to Tianqi shareholder approvals and regulatory approvals in China.
The company requested a further trading suspension on its shares ahead of a shareholders meeting on Tuesday, March 17, to approve the revised terms of the deal.
"In the event that the company is still unable to provide information around the definitive timing of completion to shareholders at that time, it will request a further extension to the voluntary suspension," Galaxy said in a statement.
Galaxy's Jiangsu troubled lithium processing plant was the brainchild of former managing director Iggy Tan, who had a dream of turning Galaxy into an integrated lithium mining and processing company.
But the plant was plagued with problems, spectacularly highlighted when a pipe exploded in 2012, killing two employees and injuring several others.
Despite its efforts, the company has never been able to run the plant as a cash flow positive operation.
It struck a long awaited deal to sell the plant to Tianqi in April last year.
Shares in the company last traded for 2.5 cents.
