TORONTO/VANCOUVER (Reuters) – SoftBank Group Corp’s (9984.T) entry into the lithium sector, a hot commodity for electric car batteries, is raising hopes that small miners struggling to secure bank funding can tap alternative financing to cash in on booming demand.
Japan’s SoftBank, with investments including ride-services firm Uber [UBER.UL] and Chinese online retailer Alibaba (BABA.N), will invest up to C$99.1 million ($78 million) for a stake of up to 9.9 percent in Nemaska Lithium Inc (NMX.TO).
Separately, Nemaska is also in talks with U.S. private equity firm Orion Mine Finance on a streaming deal, a type of specialized mining finance, people familiar with the transaction told Reuters. Nemaska shares jumped as much as 20.5 percent on Friday, giving the Quebec-based company a market value of C$566 million.
“These alternate forms of financing, I think, are going to become more common,” said Tim Johnston, chief executive of Desert Lion Energy (DLI.V), developing a lithium mine in Namibia.
Nemaska, which last week said it was in the final stages of negotiating a $150 million streaming deal, and Orion declined to comment on the stream. Sources declined to be identified as talks are confidential.