Canadian Lithium Developer Receives US$100 Million Equity Infusion from Leading US Investment Group

Source: Streetwise Reports   11/24/2021

Standard Lithium Ltd.’s shares rose 22% after the firm reported that a Koch Investments Group subsidiary has agreed to make a strategic investment in the company of CA$127.07 million via a direct private placement.

Lithium project developer Standard Lithium Ltd. (SLI:TSX.V; SLI:NYSE American), which is engaged in development, extraction and production of lithium carbonate, today announced that “Koch Strategic Platforms (KSP), a subsidiary of Koch Investments Group, will make a US$100 million investment in Standard Lithium through a direct private placement to support the company’s strategic development goals.”

The companies noted that the KSP’s decision to invest in Standard Lithium was made after extensive due diligence regarding Standard’s LiSTR DLE technology, its Lanxess project’s demonstration plant and its project development plans.

In addition to the direct equity investment, the two firms expect to pursue strategic opportunities with other Koch Industries affiliate companies to achieve Standard Lithium’s project development objectives. Specifically, the firms mentioned that Koch Engineered Solutions (KES) will be an excellent collaborative partner that can provide key process equipment, engineering, procurement, and construction services and Koch Minerals & Trading (KM&T) is well suited to handle trading of required materials and lithium products produced.

The company advised that the net proceeds from the investment will be used to continue and accelerate its first commercial Lanxess facility project and to advance its South West Arkansas Lithium Project. The funds will also be utilized to further improve and commercialize Standard’s modern lithium extraction and processing technologies that in turn will allow for even greater project expansion.

Standard Lithium’s CEO Robert Mintak commented, “We’re entering an important phase for Standard Lithium and we’re thrilled to be starting it with a globally recognized industrial leader like Koch Strategic Platforms as a partner…KSP has an impressive track record of investing in disruptive technologies and their backing is an important endorsement of the Company’s core technology, development plans and of our intent to make the Gulf Region a leading supplier of lithium resources.”

Koch Strategic Platforms’ President David Park remarked, “KSP is focusing on investing in companies with strong tailwinds that are disrupting the market as we know it. We are excited to invest in Standard Lithium as they pave a path forward towards lithium production here in the U.S. This is an exciting time for energy transformation and we believe KSP’s investment in Standard Lithium can help accelerate the production of lithium resources right here at home.”

The report indicated that through a direct private placement, KSP will invest a total of CA$127.07 million (US$100.0 million) in Standard Lithium. In exchange, KSP will receive 13,480,083 of Standard Lithium’s common shares at a price of CA$9.43 (US$7.42). The transaction is conditional upon adherence to certain statutory resale restrictions under U.S. and Canadian securities laws and remains subject to ordinary closing conditions and approval from TSX Venture Exchange.

Standard Lithium Ltd. is a lithium development and production company headquartered in Vancouver, B.C. The firm at present is engaged in testing and proving commercial viability of lithium extraction from greater than 150,000 acres of permitted brine operations at its Lanxess Project in southern Arkansas. The firm stated that at its flagship Lanxess south plant facility, it has it has commissioned “a first-of-a-kind industrial-scale direct lithium extraction demonstration plant that utilizes its proprietary LiSTR technology to selectively extract lithium from Lanxess’s tail brine.”

The company mentioned that its processes are environmentally friendly as there is no need to build evaporation ponds. In addition, Standard’s methods significantly reduce processing time and enhance lithium recovery yields. The firm noted that it is also actively pursuing a 30,000-acre property package of lithium resources in southwest Arkansas offering brine leases as well as 45,000 acres of mineral leases in San Bernardino Co., Calif.

Koch Strategic Platforms has offices in Atlanta, Ga. and Wichita, Kan. and is one Koch Investments Group’s six key subsidiaries along with Koch Asset Management, Koch Disruptive Technologies, Koch Equity Development, Koch Investment Management and Koch Real Estate Investments. KSP was established in 2020 with its efforts centered around making key strategic investments in both public and private high-growth companies across many industries that demonstrate innovative and disruptive potential.

Standard Lithium started the day with a market cap of around $1.3 billion with approximately 147.4 million shares outstanding. SLI shares opened more than 11% higher Friday at $9.68 (+$0.98, +11.26) over Thursday’s $8.70 closing price. The stock traded Friday between $9.18 and $10.74 per share and closed for trading at $10.63 (+$1.93, +22.18%).

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