GM is investing $625M into a joint venture to develop and operating LAC's lithium mine, getting a 38% stake in the Thacker Pass project. It is the largest public investment in the sector by an OEM auto company, and highlights the need for a domestic supply of lithium. Under the JV, LAC will contribute $387M. It currently has $376M cash. The deal replaces a planned equity investment by GM, so there is less share dilution. GM invested $320M last year and got 15M shares in that deal. It is a very strong endorsement and takes away financing risk for the development. Certainly a positive move, but the stock still remains down 60% in the past year even after this week's gains. But for the sector it remains one of our favourites, with associated small cap and other risks to be aware of.
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