Talga (ASX:TLG) share price slides 7% despite positive update

It’s been a day to forget for Talga shares…

| More on:
Downward red arrow with business man sliding down it signifying falling asx share price.

Image source: Getty Images

The Talga Group Ltd (ASX: TLG) share price is backtracking today despite announcing a positive update to the ASX.

At the time of writing, Talga shares are swapping hands for $1.325, down 7.02%.

What did Talga announce?

In its release, Talga advised that LKAB and Mitsui have extended a Letter of Intent (LOI) for the Swedish graphite anode project.

Established since 1890, LKAB, or known as Luossavaara- Kiirunavaraa Aktiebolag is an international mining and minerals group based in Sweden. The company is focused on mining and processing iron ore for the steel industry.

Mitsui, on the other hand, is one of the largest general trading companies headquartered in Japan. Its businesses cover energy, machinery, chemicals, food, textile, logistics, finance and more.

Under the agreement, LKAB and Mitsui will work together in co-developing Talga’s European green anode project for lithium-ion batteries. This includes the construction of a 19,000 tonnes per annum (tpa) anode production facility and an integrated mining operation in northern Sweden. The latter will provide an additional 85,000tpa capacity of the anode material.

The extension of the LOI follows both joint venture partners engaging in customer interactions, and advanced discussions on the potential development. Talga noted that the terms of the agreement are being progressed by all parties involved.

The LOI has an expiry date for 30 November 2021 for LKAB and Mitsui to enter into a formal arrangement.

Talga managing director, Mark Thompson commented:

Talga is very pleased to progress JV partner discussions with LKAB and Mitsui for the development of our European anode supply chain to serve the lithium-ion battery market from our Swedish operations. We look forward to continue exploring potential synergies across operations, investment and global sales/distribution in our partnership negotiations.

Talga share price summary

Since the middle of November, Talga shares have barely made any significant movement, hovering around the $1.50 mark. The company’s share price however is up more than 130% when looking at the last 12 months.

On valuation grounds, Talga presides a market capitalisation of roughly $410 million, with approximately 303 million shares outstanding.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of January 12th 2022

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Materials Shares

Male DGL employees working with chemical bins symbolising the rising DGL share price today
Materials Shares

DGL share price surges 5% on acquisition announcement

DGL is investing in its warehousing capacity.

Read more »

a man wearing a hard hat stands in front of heavy mining machinery with a serious look on his face.
Materials Shares

The Mineral Resources share price has dumped 13% in a month. Time to dig in?

Could Mineral Resources go higher?

Read more »

A group of people in suits and hard hats celebrate the rising BHP share price with champagne.
Materials Shares

Why are ASX lithium shares off to such a flying start this week?

What is driving up ASX lithium shares today?

Read more »

Rising arrow on a blue graph symbolising a rising share price.
Materials Shares

Why is the Galileo Mining share price jumping 42% today?

Galileo Mining's shares are rocketing higher again on Monday...

Read more »

A businesswoman looks out a window at a green, environmental project.
Materials Shares

Boral share price climbs amid ‘game changing’ carbon project

The project could see Boral producing zero-carbon lime and cement.

Read more »

A serious construction worker ready to drill into bricks
Materials Shares

The Boral share price has been smashed 10% so far in May. What’s happening?

The building products company is facing several headwinds right now.

Read more »

A group of business people pump the air and cheer.
Materials Shares

Neometals share price leaps 11% on Mercedes-Benz deal

ASX investors are excited by the latest news from Neometals today.

Read more »

Businessman in a Cold Office with Snow and Ice.
Materials Shares

Why is the Australian Strategic Materials share price frozen today?

The emerging critical metals producer’s shares are on ice. Here are the details.

Read more »