Ganfeng Lithium's unit to buy up to $180M CB from Lar

Lithium Argentina AG (TSX: LAR, NYSE: LAR) has entered into a definitive agreement with Ganfeng Lithium Group Co., Ltd. to issue a $180 million unsecured convertible note as part of a strategic investment. The note carries a 4.0% annual coupon and is convertible into Lithium Argentina’s common shares at $12.50 per share, a price representing a 96% premium to the five-day volume-weighted average price on the NYSE as of August 21, 2026. The proceeds from the investment will be used to fully repay the company’s $259 million convertible debt due in January 2027, extending its debt maturity profile and strengthening its balance sheet.

The convertible note matures in six years, with the option for early redemption under specific conditions. If not converted, the note will mature in 2032. The investment also includes anti-dilution protections and a 12-month participation right for Ganfeng to maintain its ownership level. Conversion is capped at 19.99% of Lithium Argentina’s issued and outstanding shares.

Ganfeng currently owns approximately 9.6% of Lithium Argentina’s shares. If the note is fully converted, Ganfeng’s ownership would increase to approximately 16.1% on a fully diluted basis. The strategic investment is expected to close in September 2026, pending regulatory approvals from the TSX and NYSE.

In parallel, Lithium Argentina and Ganfeng have finalized a joint venture to consolidate the Pozuelos-Pastos Grandes lithium projects in Salta Province, Argentina. The joint venture, with Ganfeng holding 67% and Lithium Argentina 33%, aims to develop a 150,000 tonnes per annum lithium carbonate equivalent (LCE) operation across three phases. The joint venture is expected to be completed in September 2026.

Both parties emphasized the long-term strategic value of the partnership, with Lithium Argentina’s CEO noting the strengthened balance sheet and the potential for organic growth at Cauchari-Olaroz. Ganfeng’s CEO highlighted the shared vision to expand lithium production capacity in Argentina and support the region’s role in low-cost, environmentally responsible lithium production.