Neo Lithium Corp. (TSXV: NLC | OTCQX: NTTHF) was one of the standout performers in 2021 delivering a return to investors of 219%, a 5.35x gain for those investors lucky enough to have bought in at the IPO on July 20, 2016 at C$1.20 per share. Neo Lithium is now trading at C$6.42 with the Zijin Mining takeover offer at C$6.50 a share having recently been approved by Neo Lithium shareholders.
Today’s article gives an update on Neo Lithium and mentions another company that has several things in common with Neo Lithium, meaning it could be the next success story.
Neo Lithium stock price went from C$1.20 at IPO to $6.42
Source: Yahoo Finance
An update on Neo Lithium
As announced on December 10, 2021 Neo Lithium shareholders approved the arrangement effectively selling their shares in Neo Lithium to China’s Zijin Mining Group at C$6.50 a share. 91.42% of shareholder votes were in favour of the transaction. The announcement stated: “Subject to obtaining all required approvals and satisfying all required conditions, the Transaction is expected to close in the first quarter of 2022…..Following closing of the Transaction, the Common Shares will be de-listed from the TSX Venture Exchange.” There is the option for investors to buy into China copper-gold miner Zijin Mining Group (SHA: 601899) (HK: 2899) if they wish to still have exposure to Neo Lithium’s prized 3Q Project, whose Environmental Impact Assessment (EIA) was recently approved by the Catamarca Government in Argentina.
Effectively this ends the story for investors in Neo Lithium. But there is a another ‘Neo’ to consider.
Neo Performance Materials Inc. (TSX: NEO) – The next ‘Neo’
While there is no doubt that Neo Lithium President & CEO, Dr. Waldo Perez, (who also discovered Lithium Americas Cauchari Project) and its CFO, Carlos Vincens, played a huge role in the success of Neo Lithium, there is another person of interest. And that is Neo Lithium Chairman Constantine Karayannopoulos, who served on the Neo Lithium Board from February 9, 2016. He is also the President and Chief Executive Officer of Neo Performance Materials Inc. (TSX: NEO). Neo Performance Materials returned shareholders a 49% gain in 2021 and offers investors a similar early stage (to get in) opportunity, albeit this time in rare earths processing and permanent magnets materials.
For investors who believe success breeds success (as I do), and who look to follow star performers then I suggest you take a closer look at Neo Performance Materials. The Company is unique in the way it is positioning itself as the only non-Chinese processor of rare earth materials into separated rare earth chemicals that are then used internally to produce rare earth fine chemicals, metals, alloys, and “bonded” rare earth permanent magnets. You can read more about Neo Performance Materials in my linked article below.
- Neo Performance Materials looks to expand capacity as it rides the tailwind of growing rare earth permanent magnet demand
In the above article global rare earths expert Jack Lifton quotes his view on Neo Performance Materials stating:
“Neo Performance Materials is today, the only Western company that is vertically integrated with the capability and commercial scale capacity to separate the rare earths, manufacture rare earth metals and alloys, and manufacture rare earth permanent magnets. It is the non-Chinese model for any venture seeking to enter or assemble a total rare earths permanent magnet supply chain.”
Neo Performance Materials position in the supply chain for rare earths based products
Source: Neo Performance Materials company presentation
The story on Neo Lithium is now closing with the successful takeover by Zijin Mining now in its final stages. Investors who were in early, since the IPO, made a very nice 5.35x gain, and in some cases even more if they followed me buying at the 2019 low around C$0.58 (see my article here) and selling recently above C$6.40 for a 11x gain.
Looking ahead I see some similarities between Neo Lithium and Neo Performance Materials. Both have top quality management and Constantine Karayannopoulos is involved in both. Both companies are leaders in their field, noting Neo Lithium in lithium and Neo Performance Materials in rare earths processing and production of valuable rare earth based end products. Finally, both are beneficiaries of the EV boom and the demand for EV related metals such as lithium and the rare earths, NdPr.
They say follow the money and that is true, but better still is to follow successful top tier management, especially if they have the tailwind of a winning trend.
In 2022 we say farewell to Neo Lithium and hello to Neo Performance Materials. It should be another great year for those companies related to the electric vehicle boom.
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