The Metalstech Ltd (ASX: MTC) share price is deep in negative territory on Wednesday. This comes after the gold explorer provided a market sensitive release yesterday afternoon.
At the time of writing, Metalstech shares are down 8.70% to 63 cents a pop. However, today's fall is most likely attributed to some heavy profit-taking by investors. The company's shares are up almost 20% for the week and 130% in a month.
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What did Metalstech announce?
According to its release, Metalstech advised its wholly-owned subsidiary Winsome Resources, has signed a binding agreement with China Jushi.
Founded in 1998, China Jushi is the largest fibreglass manufacturer in China. The company specifically produces glass fibres, advanced composite materials and other products.
International operations extend out to North Carolina in the United States, with sales across a number of countries worldwide.
Under the agreement, China Jushi will subscribe for up to 9.9% of all shares issued in the proposed Winsome float. This equates to around $2.7 million in value, bringing the total float amount to $5.7 million. The remaining $3 million is being committed by North America's Lithium Royalty Corp.
The issue price per share is listed at 20 cents each for China Jushi, acquiring roughly 13.5 million shares.
Metalstech shareholders are expected to receive about $9 million worth of shares in Winsome by a way of distribution. This translates to 45 million Winsome shares (1 free share held for every 3.68 Metalstech shares held).
Metalstech chair Russell Moran, touched on the strategic commitment, saying:
The Winsome team have done a fantastic job courting leading industry participants to support their lithium business vision. Metalstech shareholders eligible at the record date will capitalise on what is shaping up to be a fiercely sought-after battery metals focussed share offering through proposed in-species distribution.
About the Metalstech share price
It has been an astounding year for Metalstech shares, accelerating close to 300% in a year. When looking at 2021, its shares are up 200% and reached a record high of 80 cents on Monday.
Metalstech has a market capitalisation of roughly $101.82 million, and approximately 165.56 million shares on its books.
