Lithium Energy And NOVONIX To Spin-Out Graphite Assets Via IPO

Lithium Energy Ltd (ASX: LEL) and NOVONIX Ltd (ASX: NVX) are combining their adjoining Queensland graphite assets into a spin-out company, Axon Graphite Ltd.

The companies have completed their due diligence and have issued notices to proceed with the agreement.

The proposed new company, Axon Graphite, plans to raise up to A$25M (minimum A$15M) at A$0.20 per share.

World-class natural graphite inventory

The merger of NOVONIX’s Mt Dromedary Graphite Project and Lithium Energy’s adjoining Burke Graphite Project will create a world-class inventory of high-grade natural graphite.

This will include:

  • Burke Deposit: Total resource of 9.1 million tonnes at a grade of 14.4% total graphitic carbon (TGC) for 1.31 million tonnes of contained graphite; and
  • Mt Dromedary Deposit: Total resource of 14.3 million tonnes at 13.3% TGC for 1.908 million tonnes of contained graphite (at a 4% cut-off grade).

Battery anode facility

Importantly, the combination of these two adjoining high-grade graphite deposits creates the potential for significant operational synergies.

This is expected to underpin the development of a vertically integrated battery anode material (BAM) manufacturing facility in Queensland.

Assuming a A$20 million raising, Lithium Energy and NOVONIX will each hold a stake of 25% in Axon Graphite on completing the IPO.

The prospectus for the IPO is expected to be lodged within the next 4 to 6 weeks.

 

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