Latin Resources (LRS) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition diversifies revenue beyond the core asset, adding a second Tier One, low-cost hard rock lithium project in Brazil and expanding into North American and European battery markets.

• Transaction is counter-cyclical, leveraging a low point in the lithium price cycle to secure a high-quality asset and aligns with strategic pillars of diversification and operational excellence.

• Latin Resources shareholders gain immediate premium, access to a larger, more liquid company, and ongoing exposure to Pilbara's broader lithium business.

• Salinas project offers near-term production optionality and leverages Pilbara's technical expertise to de-risk and optimize development.

• Pilbara's strategy focuses on sustainable battery materials and global growth ambitions.

Financial terms and conditions

• All-share transaction: Latin shareholders receive 0.07 Pilbara shares per Latin share, implying a 32% premium to 30-day VWAP and 57% to 10-day VWAP, with an implied offer price of ~A$0.20 per share.

• Pilbara shareholders will own ~93.6% and Latin shareholders ~6.4% of the combined group post-transaction.

• Pilbara to provide a A$10 million loan facility to Latin for working capital and early works, repayable based on Scheme outcome.

• Pro-forma market capitalisation of A$9.2bn and combined Mineral Resources of 14.1Mt LCE.

• Scheme meeting expected mid-November 2024, with completion late November/early December 2024.

Synergies and expected cost savings

• Pilbara's mining, processing, and technical expertise expected to de-risk and accelerate Salinas' development, with potential for operational efficiencies and cost competitiveness.

• Access to Pilbara's intellectual property and midstream technology may enhance project value and enable flow sheet optimization.

• Salinas is expected to add ~20% to Pilbara's Mineral Resources and contribute up to ~30% of pro-forma steady state production.