Lithium Argentina Finalizes PPG Joint Venture; Announces $180M Strategic Investment from Ganfeng
Ganfeng issued $180 million in convertible notes at $12.50 to eliminate its January 2027 debt maturity.
Lithium Argentina AG (LAR) and Ganfeng have entered definitive agreements to finalize the Pozuelos-Pastos Grandes (PPG) joint venture, consolidating the Pozuelos-Pastos Grandes, Pastos Grandes, and Sal de la Puna projects into a single basin-wide initiative. Under the terms of the deal, Ganfeng will hold a 67% stake in the PPG JV, while Lithium Argentina retains 33%. The transaction is expected to be completed by September 2026 through Millennial Lithium B.V.
The PPG project targets a production capacity of 150,000 tonnes per annum of lithium carbonate equivalent (LCE) across three phases. Lithium Argentina submitted an RIGI application in the first quarter of 2026, with regulatory approval anticipated by the end of 2026. To support the venture, Ganfeng will invest $180 million via a six-year unsecured convertible note. The note carries a 4.0% semi-annual coupon, a conversion price of $12.50, and a maturity date in 2032, with no attached offtake agreements or security.
Proceeds from the new financing, combined with cash on hand, will be used to fully repay $259 million in convertible debt due in January 2027. Concurrent with the closing of the PPG JV, the existing $130 million debt facility will be terminated, releasing associated security and preferential offtake rights.
Ganfeng currently owns approximately 9.6% of Lithium Argentina. Full conversion of the new note would add 14.4 million shares, raising Ganfeng’s stake to approximately 16.1% on a fully diluted basis. Lithium Argentina ended the second quarter of 2026 with $100 million in cash and received $27 million in distributions from the Cauchari-Olaroz project in the third quarter of 2026.
Lithium Argentina AG (LAR) announced a $180 million strategic investment that addresses the company’s most serious near-term risk: the $258.8 million convertible notes due January 2027. The Q2 2026 MD&A had previously flagged a material going-concern uncertainty tied to reliance on Cauchari-Olaroz distributions to service that maturity. The new transaction extends the maturity to 2032 and replaces secured, offtake-linked obligations with an unsecured note carrying no offtake rights.
The finalization of the PPG joint venture represents a follow-through on previously disclosed terms, including the 67/33 structure, the expected RIGI submission, and the guided closing date. The investment carries a conversion price of $12.50, which is approximately 96% above the five-day VWAP cited by the company, though only about 33% above the August 21 close of $9.42 following a stock rally into the announcement.
If the note converts, it would result in 14.4 million new shares, representing roughly 8-9% additional shares and increasing Ganfeng’s stake to approximately 16.1%. The transaction removes the perceived balance-sheet overhang, potentially allowing the market to refocus on Cauchari-Olaroz cash flows and PPG/Stage 2 growth. As Ganfeng is already a core shareholder, this is not considered a first-time strategic investor event.
Lithium Argentina AG (LAR) is a lithium carbonate producer headquartered in Zug, Switzerland, and listed on the TSX and NYSE under the ticker LAR. Its flagship asset is the Cauchari-Olaroz operation in Jujuy province, Argentina, which is owned 44.8% by LAR, 46.7% by Ganfeng, and 8.5% by JEMSE, a Jujuy government mining company.
Cauchari-Olaroz Stage 1 has a capacity of 40,000 tpa LCE. Production in Q2 2026 was 9,280 tonnes, bringing H1 2026 output to 19,000 tonnes, with FY2026 guidance set at 35,000-40,000 tonnes. In Q2 2026, the realized price was approximately $19,563/tonne against a cash operating cost of $5,897/tonne.
The company is pursuing a Stage 2 expansion targeting an additional 45,000 tpa LCE. RIGI approval for this expansion was received in May 2026, and a modular 10,000 tpa initial step is currently under discussion.
PPG is the company’s growth project located in Salta province, targeting 150,000 tpa LCE across three phases. A prior scoping study indicated an after-tax NPV8% of $8.1B and an IRR of about 33% at $18,000/tonne LCE.
Corporate financial statements show no revenue at the LAR level; results are driven by JV interests, interest income, and equity-method-type economics.