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VANCOUVER - United Lithium Corp. (CSE:ULTH; OTCQX:ULTHF), a micro-cap mining explorer with a market capitalization of $7.49 million, announced Friday it has entered into a binding Letter of Intent to acquire all outstanding shares of Swedish Minerals AB, creating what the company describes as a "Nordic-based strategic-metals explorer" with a diversified portfolio of lithium, uranium, and rare-earth assets. According to InvestingPro analysis, the company maintains a FAIR financial health score of 2.42, though it faces challenges with cash burn.
Under the agreement, United Lithium will pay Swedish Minerals shareholders 25 million common shares at a deemed price of $0.20 per share (pre-consolidation) and $450,000 in cash. The transaction includes a $50,000 non-refundable deposit upon execution of the LOI, with the remaining $400,000 due at closing. The company’s strong liquidity position, with a current ratio of 4.02, suggests adequate resources to meet these financial obligations.
The deal will coincide with a 2:1 share consolidation of United Lithium’s outstanding shares, resulting in approximately 43.9 million shares outstanding post-transaction. United Lithium will also grant Swedish Minerals shareholders a 1.75% net smelter return royalty on all properties currently held by Swedish Minerals.
Following the acquisition, United Lithium’s board will be reconstituted with five members - three nominated by United and two by Swedish Minerals. Andrew Bowering will be appointed Interim CEO and Jonathan Franklin as President.
Swedish Minerals brings a portfolio of uranium projects in Finland and Sweden to the combined entity, including the Riutta Project in Finland and the Duobblon, Norr Döttern, and Märrviken projects in Sweden.
In a separate announcement, United Lithium disclosed plans for a non-brokered private placement to raise up to $2.25 million through the issuance of up to 15 million pre-consolidation units at $0.15 per unit. Each unit includes one share and one warrant exercisable at $0.30 for 24 months.
The transaction remains subject to due diligence, regulatory approvals, and other customary closing conditions. The financing is not conditional on the completion of the acquisition.
This article is based on a press release statement from United Lithium Corp. Despite recent challenges, the company has shown strong momentum with a 66.67% price return over the past six months. InvestingPro subscribers can access 8 additional key insights about United Lithium’s financial health, valuation metrics, and growth prospects to make more informed investment decisions.
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