(Yicai Global) Oct. 11 -- Zijin Mining Group’s shares jumped after the Chinese company said it plans to acquire Canada’s Neo Lithium for CAD960 million (USD770 million), giving it access to one of the biggest and highest-grade lithium brine projects in the world.

Zijin’s stock price [SHE:601899] ended 7.6 percent up today at CNY11.04 (USD1.71), after earlier gaining as much as 8.4 percent.

The Fujian province-based firm will pay CAD6.50 (USD5.21) for each share of Neo Lithium, the pair announced on Oct. 8, representing a premium of about 36 percent on the 20-day average price on the TSX Venture Exchange as of the same day.

Neo Lithium’s primary asset is the Tres Quebradas Salar Lithium project, also known as the 3Q project, in Argentina’s largest lithium-producing area. Spanning 353 square kilometers, it has expected production capacity of 20,000 tons of battery-grade lithium carbonate a year over a 35-year lifespan. The annual capacity could be expanded to as much as 60,000 tons.

“The 3Q project represents an important addition to Zijin's growing global asset mix and it is a good choice for Zijin to enter the field of new energy minerals,” said Chairman Chen Jinghe.

Neo Lithium [TSXV:NLC] rose 1.7 percent in Toronto to end at CAD5.49 on Oct. 8, while its shares on the US over-the-counter market [OTCQX: NTTHF] gained 2.3 percent to USD4.40.

“After a thorough strategic process, we are very pleased to provide this all-cash premium offer to our shareholders from a leading global mining company,” said Waldo Perez, president and chief executive of Neo Lithium.

“This is the result of the collective work of our premier lithium brine exploration team, starting from initial discovery in late 2015 to defining one of the largest and highest-grade lithium brine deposits in the world, and culminating in this premium offer in just six years,” Perez said.

The takeover is subject to regulatory approval in China and Canada and is expected to be completed by the first half of next year. But Zijin cautioned that it is unsure whether the deal can be finalized, adding that there are uncertainties due to the construction schedule, regional and market risks, and other factors.

Zijin’s revenue was CNY110 billion (USD17 billion) in the first half, up 32 percent from a year earlier. Net profit jumped 175 percent to CNY6.6 billion (USD1 billion) in the same period. Its asset of overseas mines and ores and its corresponding profits are around half of the company’s total.

Editor: Futura Costaglione