I have updated my valuation model, incorporating new information from the Circular, and current lithium pricing. Based on fairly conservative assumptions, I value LAC (North America) at $11 per share, and LAAC (Argentina) at $23 per share.

Post separation and confirmation of the DOE loan financing, GM will invest a further $330m in LAC. The issue price for these shares will be the volume weighted average price (VWAP) during the five days after financing is confirmed. However, GM’s total ownership interest must remain less than 30%, otherwise GM has to consolidate their ownership interest, which they don’t want to do. That implies the maximum issue of 47m shares, which in turn implies a VWAP of $7. The VWAP could be higher or lower than $7, but I wouldn’t be surprised to see LAC trade at or about that level during the VWAP period. If it does, I intend to rotate out of LAAC and into LAC.