The Firefinch Ltd (ASX: FFX) share price is flying higher in morning trade, up 4.8% after posting earlier gains of 6.4%.
Firefinch shares closed on Friday at 95 cents and are currently trading for 99 cents.
Here's why ASX investors are bidding up the Mali-focused gold miner and lithium developer's shares.
What is the latest progress on the joint venture?
The Firefinch share price is marching higher after the company reported that the final conditions have been met regarding Jiangxi Ganfeng Lithium Co's investment into its Goulamina Lithium Project.
After the transfer of the exploitation licence for the Goulamina to Lithium du Mali SA (LMSA) – a wholly-owned subsidiary of the joint venture (JV) company – Firefinch and Ganfeng now each hold a 50% interest in the JV company.
Firefinch said that all other conditions precedent had been satisfied. That includes a 'letter of no objection' from the Malian government.
The Firefinch share price could be getting a boost today from the report that under the JV agreement, Ganfeng will provide US$130 million of equity funding to the JV company. Ganfeng will also provide either US$40 million of Ganfeng direct debt or source US$64 million of third-party debt.
With the final conditions of the JV satisfied, Firefinch can now proceed with the demerger of Goulamina into Leo Lithium Limited. Firefinch expects to list Leo Lithium as a separate entity on the ASX later this year. Leo is the Firefinch group entity that holds its interest in the JV.
Firefinch managing director Michael Anderson commented on the progress:
This is a long-awaited and significant milestone. We have been working tirelessly to progress the joint venture and demerger process to deliver value for shareholders and are delighted to be on the brink of achieving the intended result.
Leo managing director Simon Hay added:
This is this a tremendous step along the path to listing Leo Lithium and developing Goulamina as one of the world's largest lithium producers. The combined debt and equity funding package of at least US$170 million from Ganfeng means Leo can now accelerate work on the Goulamina Project.
Firefinch share price snapshot
The Firefinch share price has gained 52% over the past month and a whopping 350% since this time last year.
For some context, the All Ordinaries Index (ASX: XAO) is up 10% over the past 12 months.
