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Highlights

  • Jindalee’s share price surged 50% to AUD 0.60 on 9 September after announcing a non-binding LOI with Constellation Acquisition Corp. I.

  • The proposed merger values the new entity (NewCo) at USD 500 million (AUD 750 million) and includes a planned raise of USD 20–30 million (AUD 30–45 million).

  • Completion is targeted for 1H 2026, pending approvals, due diligence, and execution of definitive agreements.

Jindalee Lithium Limited (ASX:JLL) shares surged 50% to AUD 0.60 per share during morning trading on 9 September following news of a proposed merger involving its US subsidiary. The announcement drove   Ainvestor interest as the company outlined plans to create a new US-listed entity focused on lithium development.

Non-Binding LOI Signed with Constellation

The company confirmed it has signed a non-binding Letter of Intent (LOI) with Constellation Acquisition Corp. I (OTCPK: CSTAF), a US special purpose acquisition company (SPAC) sponsored by Antarctica Capital, LLC. The proposal involves merging Constellation with Jindalee’s wholly owned US subsidiary, HiTech Minerals Inc., which owns the McDermitt Lithium Project in Oregon.

If completed, the merger would create a new US-listed entity (NewCo) offering direct exposure to the McDermitt Project, considered one of the largest lithium resources in the United States.

Transaction Structure and Valuation

Under the terms outlined in the LOI, Jindalee would receive 50 million new shares in NewCo at USD 10 per share, representing an equity value of USD 500 million (AUD 750 million), subject to customary adjustments.

The transaction also includes a planned capital raise of USD 20–30 million (AUD 30–45 million), with affiliates of Antarctica Capital committing USD 4 million (AUD 6 million). Upon completion, Jindalee is expected to retain more than 80% ownership of NewCo, depending on the final raise and terms.

NewCo is intended to seek a listing on a US national securities exchange following the transaction.

Strategic Rationale

According to Jindalee, the proposed merger is designed to:

  • Establish a US-listed entity directly tied to the McDermitt Project.

  • Provide funding to advance the McDermitt Feasibility Study.

  • Enhance visibility in US capital markets for future development requirements.

Jindalee shareholders would retain significant exposure to the McDermitt Project through a majority interest in NewCo. A seven-member board is proposed, with Jindalee holding majority representation.

Timeline and Risks

The LOI grants both parties a 90-day exclusivity period for due diligence and negotiation of a binding Business Combination Agreement (BCA). Signing of the BCA is targeted for Q4 2025, with completion anticipated in the first half of 2026, subject to shareholder approvals, regulatory clearances, and exchange requirements.

The company emphasised that the LOI is non-binding, and there is no certainty the transaction will proceed. Risks include potential failure to meet conditions, lack of approvals, or NewCo’s shares trading below the implied valuation post-listing.

About Constellation and Antarctica Capital

Constellation Acquisition Corp. I is a SPAC established to pursue business combinations. Its sponsor, Antarctica Capital, LLC, is an SEC-registered alternative asset manager with more than USD 8 billion (AUD 12 billion) under management as of 31 December 2024.