BMW supplier European Lithium is in talks to merge with Sizzle SPAC

A UNIT of Australian miner European Lithium has agreed to go public on Nasdaq through a merger with blank-cheque company Sizzle Acquisition.

The deal will give the combined business a market value of about US$972 million, assuming no redemptions, according to a statement on Monday (Oct 24), confirming an earlier Bloomberg News report. The merged entity Critical Metals will own European Lithium’s project in Wolfsberg, Austria, which could be the first licenced lithium mine in Europe.

Western Australia-based European Lithium, led by chief executive officer Dietrich Wanke, in August announced an agreement with BMW to supply battery-grade lithium hydroxide, its website shows. The firm hopes to add consumers including electric vehicle (EV) and battery manufacturers in the region.

“The project is poised to become the first major source of battery-grade lithium concentrate in Europe, the world’s leading EV market, capable of supporting the production of approximately 200,000 EVs per year,” Critical Metals executive chairman Tony Sage said in the statement. “We believe we will be able to achieve our commercial goals by 2025.”

Demand for lithium, a material that’s key to the renewable-energy transition, is forecast to almost triple by mid-decade from last year’s level, BloombergNEF said in a July report. Nations including the US have raised concerns over China’s domination of refining and production capacity for key materials like lithium, rare earths and cobalt.

Based on a pre-feasibility study, European Lithium said it expects Wolfsberg to supply approximately 10,500 metric tons of lithium concentrate annually by 2025. On Monday, the company had requested a trading halt “pending an announcement regarding a proposed merger transaction”.

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Sizzle, a special purpose acquisition company (SPAC), raised US$155 million in a November 2021 initial public offering. As its biggest shareholder, European Lithium plans to nominate four of the five board members of the combined business. The deal could be completed in the first half of 2023.

Australian-listed Security Matters struck a deal with a US special purpose acquisition company in July, in part to obtain a Nasdaq listing. BLOOMBERG