Kalamazoo Resources has completed the spin out of its lithium portfolio, with new listing Kali Metals launching onto the ASX boards with a big price jump after raising its maximum subscription of $15 million.
TSX-listed Karora Resources has also added its Higginsville lithium project into the spin-out company, giving Kali a combined 3800 square kilometres of tenements, including about 1600sq km in the East Yilgarn lithium corridor that is home to Mineral Resources’ Marion lithium mine and Liatam Mining’s Bald Hill lithium mine.
Shares in Kali touched as much as 47.5 cents during intraday trading today, an increase of 90 per cent from its initial public offering price of 25c.
Management says exploration activities have already been progressing across the entire Kali project portfolio, including field reconnaissance and rock chip sampling campaigns in addition to planning for its new year exploration programs. It includes a maiden reverse-circulation (RC) drill program that is set to kick off at Higginsville within the first half of the year.
Kalamazoo retains more than 29 million ordinary shares in Kali, representing 20.2 per cent of the freshly-listed company’s issued capital. Eligible shareholders also received one ordinary Kali share for every 17.64 ordinary Kalamazoo shares through an in-specie distribution of a total of 9,715,750 ordinary shares. representing 6.7 per cent of Kali’s issued capital.
With its lithium assets squared away with Kali, Kalamazoo plans to focus its attention on its gold portfolio. It recently reported an updated mineral resource estimate at its Ashburton gold project in Western Australia’s Pilbara region of 16.2 million tonnes at a solid grade of 2.8 grams per tonne for a total of 1.44 million ounces, based on its four key deposits at Mt Olympus, Peake, Waugh and Zeus.
The response from Kalamazoo shareholders and new and sophisticated investors through the IPO process has been incredible with the maximum $15 million having been quickly raised. As a significant shareholder of Kali and with our shareholders also receiving an in-specie distribution of Kali shares, Kalamazoo is looking forward to the acceleration of exploration activities across Kali’s exploration projects in 2024. Kalamazoo Resources chairman and chief executive officer Luke Reinehr
Last year, Kalamazoo revealed its plans to spin out its Australian lithium projects through a demerger and a concurrent IPO of the fledgling Kali. As part of the deal, Kalamazoo shareholders will receive Kali shares in exchange for the company’s Pilbara lithium portfolio and its Jingellic and Tallangatta lithium projects in New South Wales.
Kalamazoo’s Pilbara lithium portfolio included its Dom’s Hill and Marble Bar projects, which are part of its joint venture (JV) with major Chilean lithium producer Sociedad Química y Minera (SQM). The company previously announced that SQM has the right to earn up to a 70 per cent interest in the tenements, with an initial 30 per cent earned by spending $12 million in four years.
It also added its wholly-owned Pear Creek lithium project.
Meanwhile, Kalamazoo currently has exploration programs underway in Victoria and has begun planning for its 2024 campaigns across its gold project portfolio.
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