European Lithium (ASX:EUR) to merge with Sizzle to form Critical Metals Corp

• European Lithium (EUR) will merge with US special purpose acquisition company Sizzle Acquisition to form a lithium exploration and development company, Critical Metals Corp
• The company will sell-down its interest in its wholly-owned Wolfsberg lithium project in Vienna for US$750 million (A$117 million) in Critical Metals shares as part of the merger
• Upon finalisation, the company will hold an approximate 80 per cent interest in the combined entity, providing the group with approximately US$159 million in capital
• Shareholders are expected to approve the deal on November 30 and if approved, the company expects the listing of Critical Metals on the NASDAQ in H1 2023
• Shares in EUR end the day 7.78 per cent in the green to close at 9.7 cents

European Lithium (EUR) will merge with US special purpose acquisition company Sizzle Acquisition to form a lithium exploration and development company, Critical Metals Corp.

The merger will see the company sell-down its interest in its wholly-owned Wolfsberg lithium project in Vienna, Austria for US$750 million (A$117 million) in Critical Metals shares.

Upon closing of the transaction, the company will hold an approximate 80 per cent interest in the combined entity.

The transaction is expected to provide the combined group with approximately US$159 million in capital before expenses to fund the activities of Critical Metals Corp.

Further, the expected capital will allow Critical Metals to progress with construction and development at Wolfsberg.

As part of the agreement, the company confirmed a US$5 million breakable fee it is liable for if EUR chooses not to proceed with the transaction if it finds a better proposal.

Commenting on the transaction, EUR Executive Chairman Tony Sage said the newly-joined company will be able to achieve the company’s commercial goals at Wolfsberg by 2025.

“Wolfsberg 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,” he said.

“The funds raised though this transaction will provide us with the resources anticipated to be required to advance construction and commissioning of Wolfsberg.”

The project is the company’s flagship advanced hard rock lithium project 270 kilometres southwest of Vienna.

The company reported its total measured, indicated and inferred mineral resources at 12.88 million tonnes at one per cent lithium oxide, which confirmed its potential to be a globally significant hard rock lithium project.

It had received a positive preliminary feasibility study on Wolfsberg in April 2018 which supported the decision to progress commissioning of a definitive feasibility study (DFS), which is on-track to be delivered in Q1 2023.

EUR confirmed it will continue to be listed on the ASX as a mining company and its primary focus remains progressing the project to development.

Shareholders are expected to approve the deal on November 30 and if approved, the company expects the listing of Critical Metals on the NASDAQ in H1 2023.

Shares in European Lithium ended the day 7.78 per cent in the green to close at 9.7 cents.