Mali frees Resolute executives after $160 million deal, AFP reports
The three executives, including CEO Terry Holohan, were freed from detention on Wednesday.
A battle over control of a massive untapped lithium deposit shifted gear as AVZ Minerals Ltd.’s biggest shareholder signaled it will support the ouster of the Australian miner’s board.
The Manono project in the Democratic Republic of Congo has the potential to be one of the world’s largest sources of the battery metal but, after acquiring exploration rights seven years ago, AVZ has found itself locked in lawsuits and arbitration against its partners and the Congolese government. Competition to develop new sources of lithium has heated up in recent years due to an anticipated explosion in demand for electric vehicles, although the price has tumbled this year on a supply glut.
Yibin Tianyi Lithium Industry Co., a Chinese producer of chemicals used in EV batteries, said it would vote for the removal of the directors. “We are very disappointed with the work of the existing board,” a company representative said in a written response to questions. “The Manono project has missed the best development time already.”
Zhejiang Huayou Cobalt Co. – the second-biggest shareholder — will also back the attempt to unseat the directors at a meeting in Perth on Thursday, according to a group called Make Manono Great Again, or MMGA, that’s spearheading the campaign.
Huayou Cobalt didn’t respond to a request for comment, while AVZ declined to comment. Yibin Tianyi and its affiliates control around 7% of the shares of the Australia-listed miner and Huayou Cobalt owns about 6%. The MMGA group has just 0.14%.
AVZ had a market capitalization of A$2.75 billion ($1.8 billion) before trading was halted in May 2022, as it waited for Congo to convert the exploration permit to one that would allow it to build a mine. Authorities in the central African nation then withdrew the permit entirely earlier this year due to persistent conflicts between shareholders, before splitting the exploration area in two last month, giving the northern section to Zijin Mining Group Ltd. and Congo’s state-owned Cominiere.
AVZ and its Managing Director Nigel Ferguson have argued that the move was illegal. An arbiter at the International Chamber of Commerce in Paris ordered Cominiere to halt any move to develop the permit area last week until the ICC considers AVZ’s complaint.
MMGA has promised to end “all expensive and ineffective legal matters” within one month of appointment, negotiate with the government and shareholders to keep at least part of the project, and begin development as soon as possible.
The fate of Ferguson and his co-directors will ultimately rest on the Australian retail and institutional investors that control AVZ. MMGA said the current leadership has driven the Manono project into a stalemate that could see it lose the entire asset.
“The company’s literally drowning in a sea of litigation,” said Michael Carrick, who is running for a board seat on MMGA’s ticket. “The government has effectively slammed the door on the current board of AVZ and said enough is enough.”
(By William Clowes, Annie Lee and Michael J. Kavanagh)
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