Lithium Ionic Completes US$37.5 Million Sale of its Salinas Group of Lithium Properties to PLS

Lithium Ionic Corp. (LTH) completed the sale of its Salinas group of lithium properties, including the Baixa Grande resource, to PLS Brasil Mineração Ltda., a subsidiary of PLS Group Limited, on Aug. 25, 2026. The transaction, which mirrors the terms of the definitive agreement announced on Aug. 12, 2026, generated US$30.0 million in cash at closing. An additional US$7.5 million in deferred consideration is scheduled to be paid upon the earlier of a positive final investment decision for PLS’s Colina Project or Dec. 31, 2029.

Under the agreement, Lithium Ionic retains a 2.0% royalty on future spodumene sales from the Salinas assets through its wholly-owned subsidiary, Neolit Minerals Participações Ltda. Management stated that the cash proceeds strengthen the company’s balance sheet and that its focus remains on advancing the Bandeira project toward a construction decision.

Lithium Ionic Corp. (LTH) has completed the closing of a previously announced asset sale, confirming the receipt of US$30.0 million. The transaction closed on Aug. 25, following the initial announcement on Aug. 12, which the market had already priced in. The completion removes closing risk and bolsters the company’s balance sheet with non-dilutive cash. This influx is significant relative to prior-period figures, as Q1 2026 cash stood at C$12.0 million and working capital was C$7.8 million. The additional liquidity is particularly notable given that the latest Management’s Discussion and Analysis included a going-concern warning.

The deal structure includes a deferred payment of US$7.5 million and a 2.0% royalty, both of which are contingent and should not be valued as current cash. These contingent payments will only materialize if there are spodumene sales or a positive final investment decision (FID) at the Colina project. Consequently, the sale reduces near-term liquidity risk but does not eliminate it, as the Bandeira project still requires materially larger project financing. The company remains in a pre-revenue and pre-construction phase.

Historical project progression aligns with the timing of this closing. A February 2026 update indicated that binding offtake agreements were being advanced, which were subsequently signed in March 2026. Engineering progress advanced from 48% in February 2026 to 57% in May 2026, reaching approximately 65% by June 2026. The Aug. 12 sale agreement anticipated closing within approximately 10 business days, making the Aug. 25 completion consistent with that timeline.

Lithium Ionic Corp. (LTH) is a Canadian lithium development company focused on its flagship Bandeira project in Minas Gerais, Brazil, located within the “Lithium Valley.” A September 2025 feasibility study for Bandeira outlined post-tax NPV8 of US$1.45B and a post-tax IRR of 61%. The project features an initial capex of US$191M, sustaining capex of US$100M, and site opex of US$378/t SC6. It projects an 18.5-year mine life, average production of about 177 ktpa spodumene concentrate, and a payback period of about 2.2 years.

Bandeira mineral reserves stand at 23.2 Mt at 1.10% Li2O. Measured and indicated resources total 27.27 Mt at 1.34% Li2O, with inferred resources of 18.55 Mt at 1.34% Li2O. The project holds binding five-year offtake agreements with Sichuan Yahua and Grand Chen for up to 170,000 tpa SC6, featuring a US$1,000/t floor price and an expected US$20M pre-payment facility subject to definitive agreements.

The Salinas sale removes Baixa Grande from the portfolio but retains a 2.0% royalty. There is a timeline inconsistency to monitor: the feasibility study and most news releases point to H2 2027 for initial operations, while the investor presentation lists expected initial production in Q1 2027. Permitting is not final; the construction permit application was submitted in November 2023, and final COPAM/Quilombola consultation remains an open risk.