Africa-focused lithium exploration and development company Atlantic Lithium has entered into a binding scheme implementation deed with Chinese company Zhejiang Huayou Cobalt, which intends to acquire all of the issued shares in Atlantic Lithium for $0.25 a share in cash.

The proposed buyout values Atlantic Lithium at about $210-million and validates the company's flagship Ewoyaa lithium project, in Ghana, as well as the potential of its exploration tenure within Ghana and Côte d'Ivoire.

"The Atlantic Lithium board has undertaken a detailed evaluation of its strategic options in relation to maximising shareholder value assessed on a risk-adjusted basis and concluded that the Huayou proposal offers an attractive proposition for Atlantic Lithium shareholders, particularly when considered amid ongoing lithium price volatility, complex jurisdictional challenges and against the timing and execution risks attached to financing, developing and operating the Ewoyaa project under the project's current joint venture arrangements.

"Huayou's proposal acknowledges Ewoyaa as a highly attractive hard-rock lithium asset capable of serving the growing global electric vehicle and energy storage markets," comments Atlantic Lithium CEO Keith Muller.

The board also welcomes the endorsement of the proposed transaction by Atlantic Lithium's biggest shareholder Assore International Holdings, which holds about 26.4% of Atlantic Lithium's shares in issue.

"Following a detailed due diligence process and significant engagement with Atlantic Lithium, Huayou is very pleased to announce this transaction today.

"We look forward to working with Atlantic Lithium to complete the transaction and engaging with the government of Ghana ahead of planned development activities at the Ewoyaa project in the near term. The acquisition of the Ewoyaa project complements our existing battery metal mining operations in Africa and represents a logical transaction for Huayou as we continue to build a new energy materials business," comments Huayou chairperson and president Chen Hongliang.

"The transaction is expected to accelerate the delivery of the substantial benefits anticipated for Ghana through the construction and operation of Ewoyaa, including, notably, the socioeconomic development of the project's host communities," adds Muller.

The parties expect to finalise the acquisition, which remains subject to various conditions, later this year.