European Lithium’s share and option schemes with Critical Metals Corp. are now effective after the Supreme Court of Western Australia’s orders were lodged with ASIC. EUR securities are expected to stop trading on the ASX, with implementation scheduled for 5 November and CRML shares due to begin trading on Nasdaq the following day.
- Share and option schemes become effective after ASIC lodgement
- EUR shares and options expected to suspend from ASX trading
- Shareholders to receive 0.045 CRML shares per EUR share
- Final option consideration depends on the 28 October AUD/USD exchange rate
- Implementation is scheduled for 5 November, followed by EUR delisting
European Lithium schemes become legally effective
European Lithium Limited (ASX:EUR, FRA: PF8, OTC: EULIF) has crossed the transaction’s key legal threshold with Critical Metals Corp. (NASDAQ: CRML): both the share scheme and option scheme are now effective. EUR lodged the Supreme Court of Western Australia’s approval orders with ASIC on 27 October, completing the step required to bring the schemes into effect.
The court approved both arrangements on 26 October, after the Western Australian court approval removed the central legal hurdle to the proposed acquisition. The transaction has not yet been implemented, but EUR shares and listed options are expected to be suspended from ASX trading at the close of trading today.
Shareholders face a fixed CRML exchange ratio
Eligible EUR shareholders will receive 0.045 new CRML shares for every EUR share held at the record date, set for 4:00pm Perth time on 29 October. The ratio was announced on 21 October after the transaction’s pricing mechanism settled at the relevant floor, according to the company’s scheme timetable.
The structure will shift consideration from the ASX-listed EUR security into shares of the Nasdaq-listed CRML. Eligible holders who do not fall within the scheme’s ineligible, small-holder or electing categories will receive the CRML shares directly, while shares otherwise due to those categories will be sold through a facility and the resulting net cash proceeds distributed pro rata.
Option value still depends on the exchange rate
EUR optionholders face a less certain final share count. Options on issue at the record date will be exercised on a cashless basis, with the number of CRML shares determined under the formula in the scheme booklet. The calculation depends on the Reserve Bank of Australia’s 4:00pm Sydney AUD/USD reference rate on 27 October.
EUR is due to announce the exchange rate, the final CRML share entitlement per option and the threshold for small optionholders on 28 October. Optionholders who want to exercise their options for cash and receive EUR shares that can participate in the share scheme must do so by 5:00pm Perth time on the same day.
Implementation sets the timetable for EUR’s ASX departure
Implementation is expected on 5 November, when the scheme consideration is to be provided. New CRML shares are expected to begin trading on Nasdaq on 6 November, while EUR is expected to be removed from the ASX Official List at 10:00am Sydney time that day, subject to ASX and other required approvals.
The timetable remains indicative and may be changed with the necessary approvals. The immediate catalyst is the final option calculation on 28 October; the more consequential test is whether implementation and the switch from EUR trading to CRML trading proceed on the scheduled November dates.
Bottom Line?
The legal machinery is now in place, but value delivery still hinges on the final option calculation and the orderly transition from EUR trading to CRML ownership.
Questions in the middle?
- What CRML share entitlement will the 27 October AUD/USD reference rate produce for EUR optionholders?
- Will implementation and the Nasdaq trading start occur on the scheduled 5 and 6 November dates?
- How will the sale facility’s realised prices affect holders whose CRML shares are sold for cash?