The Sayona Mining Ltd (ASX: SYA) share price is in the red this morning after the company announced major news of its Canadian lithium activities.
It has agreed to acquire 985 square kilometres of lithium exploration claims near its majority-owned Moblan Lithium Project.
Unfortunately, the market has reacted poorly to the announcement. The Sayona share price is trading 1.28% lower at 23.2 cents at the time of writing.
For comparison, the S&P/ASX 200 Index (ASX: XJO) has lifted 0.1% today, and the S&P/ASX 200 Materials Index (ASX: XMJ) is down 0.63%.
Let's take a closer look at the latest news from the recently crowned ASX 200 lithium share.
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Sayona Mining announces 'major acquisition'
The Sayona share price is having a lacklustre morning despite news of what the company calls a "major acquisition".
It has agreed to buy 1,824 claims covering a major part of the Frotêt‐Evans Greenstone Belt.
The claims haven't been extensively explored and provide the potential for extensions of Moblan mineralisation and other regional targets. They're currently owned by Candian-listed Troilus Gold Corp.
The acquisition will cost the ASX 200 lithium company approximately CA$40 million – currently around AU$44.5 million – worth of shares.
It has also agreed to subscribe to around CA$4.8 million – approximately AU$5.3 million – worth of Troilus stock, taking its hold in the company to 9.26%.
Finally, Troilus will receive a 2% net smelter return royalty on minerals produced from the claims.
Sayona managing director Brett Lynch commented on the agreement, saying:
This is an investment in Sayona's future production … The lithium market needs large tonnages for long periods and we are excited by the potential to expand our lithium resources in northern Québec.
Added to our southern Abitibi hub centred on North American Lithium, Sayona is rapidly advancing the leading lithium resource base in North America in preparation for our move downstream into lithium carbonate and hydroxide production.
Sayona shares might have also been front of mind yesterday when the company hosted its annual general meeting (AGM). There, the company reiterated majority-owned North American Lithium (NAL) operation's restart is on track for early 2023.
Today's news also follows the revelation of an earn-in agreement signed between NAL and Candian-listed Jourdan Resources on Tuesday. The agreement covers 48 claims at Québec's Vallet Lithium Project.
Sayona Mining share price snapshot
Today's tumble hasn't been enough to plunge the Sayona share price into the longer-term red.
The stock is still 66% higher than it was at the start of 2022. It has also gained 45% since this time last year.
Meanwhile, the ASX 200 has fallen 6% year to date and 3% over the last 12 months.
