ASX-listed Jindalee Lithium subsidiary HiTech Minerals and Constellation Acquisition Corporation have entered into a definitive business combination agreement that will result in the common shares of US Elemental being listed on Nasdaq.

The transaction is poised to created a US-listed lithium development, expanding access to US institutional investors and capital to support continued technical advancement and development of assets currently owned by HiTech.

Constellation is a special purpose acquisition company sponsored by affiliates of Antarctica Capital, while US Elemental is a newly formed lithium development company that owns the McDermitt project in Oregon, as well as the Clayton North project in Nevada.

The proposed merger is expected to position US Elemental to advance large-scale domestic lithium resources at a time of increasing demand for critical minerals in the US.

Under the terms, Jindalee will roll over its 100% interest in HiTech and will thereafter own about 80% or more of US Elemental. HiTech, which holds Jindalee's US projects, will become a wholly-owned subsidiary of US Elemental.

The proposed merger implies a pro forma enterprise value of $571-million, with consideration payable to Jindalee mostly in shares of US Elemental. The transaction contemplates a capital raise of between $20-million and $30-million, including a $4-million private investment in public equity from affiliates of Antarctica Capital and additional potential third-party investors.

The new combined company is expected to have about $15-million of cash on the balance sheet after transaction-related expenses and once the deal has closed - which is earmarked for the second half of the year.

McDermitt, which is considered among the largest lithium deposits in the US, currently has a mineral resource of 21.5-million tonnes of lithium carbonate equivalent (LCE) and is anticipated to support a multi-decade project life of more than 60 years.

A prefeasibility study on the project envisions having a $3.2-billion net present value and a 17.9% internal rate of return (after tax). The project can feasibly produce 47 500 t/y of LCE during the first decade of operations.

Notably, the project aligns with US policy priorities to develop domestic sources of lithium and strengthen supply chains supporting electric vehicles, battery storage and advanced manufacturing.

Jindalee CEO and incoming Elemental CEO Ian Rodger says establishing a US-listed lithium development company marks an important milestone in unlocking the value of US-based lithium assets.

"We believe McDermitt is one of the largest lithium resources in the US and the transaction will position the company to access the capital and strategic partnerships required to advance development. We also believe a US listing provides stronger alignment with investors, policy initiatives and industrial partners focused on building a secure domestic critical minerals supply chain," he states.

In turn, Constellation CEO and Antarctica Capital managing partner Chandra Patel says US Elemental offers investors exposure to a significant US lithium resource at an important time for the industry.

"The McDermitt project, coupled with the team's experience and the scale of the resource, creates a strong platform for long-term growth. Additionally, we believe our track record as a constructive and value-added sponsor makes us compelling partners to enable US Elemental to successfully execute its public listing and become an industry leader," she concludes.