November 29, 2019 / 7:30 AM / 14 days ago

Australia's Alita Resources plans for loan to repay largest shareholder

(Reuters) - Lithium miner Alita Resources Ltd’s (A40.AX) (ALIT.SI) administrators said on Friday the company has entered into a A$70 million ($47.50 million) loan facility agreement with China Hydrogen Energy Ltd to pay back its biggest shareholder.

Earlier this year, Galaxy Resources Ltd (GXY.AX), Alita’s biggest shareholder, had bought $28.8 million worth of debt in the cash-strapped miner.

Shares of Alita, which is undergoing a wider restructuring, have been on a trading halt since Aug. 12. The trading halt is expected to continue until there is an update on the company’s review.

Lithium prices have plummeted this year, due to lower demand from Chinese customers after a change in the country’s electric vehicle subsidies and global trade tensions.

Alita had also taken a price cut on its shipment of lithium concentrate in August to a China-based chemicals maker, as it sought to offload its stockpile amid higher lithium supply.

Reporting by Shruti Sonal in Bengaluru; Editing by Shounak Dasgupta

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