Critical Metals proposes $835M all-share deal for European Lithium to gain full control of Greenland’s Tanbreez rare earth deposit, sending shares soaring.
A proposed all-share takeover worth roughly $835 million has sent European Lithium shares surging nearly 38 percent, as US-based Critical Metals moves to consolidate full ownership of one of the world’s largest undeveloped heavy rare earth deposits outside China.
The non-binding letter of intent, unveiled on April 27, 2026, centers entirely on the Tanbreez project in Greenland. Critical Metals already controls 92.5 percent of the asset after securing a majority stake in mid-April, with European Lithium holding the remaining 7.5 percent. A successful acquisition would give Critical Metals sole ownership of a deposit that a preliminary economic assessment values at $3 billion, supported by a resource base of 4.7 billion tonnes. Offtake agreements already cover 75 percent of planned production, and the US Export-Import Bank has committed $120 million in financing. First output is targeted for the fourth quarter of 2028 or the first quarter of 2029.
Under the proposed structure, European Lithium shareholders would receive 0.035 Critical Metals shares for each share they hold — a pure equity swap with no cash component. Based on recent trading levels, that exchange prices European Lithium at around $835 million.
The deal also unravels a complex cross-shareholding. European Lithium currently owns approximately 34 percent of Critical Metals’ outstanding shares, representing roughly 45.5 million shares with a market value of about $540 million. Critical Metals plans to cancel those shares upon completion, reducing dilution for existing holders and boosting the combined entity’s free float.
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The merger would create a company with pro-forma cash reserves of roughly $343 million. European Lithium contributes the bulk of that — around $219 million as of late March 2026 — while Critical Metals adds its own cash holdings. Management intends to deploy that capital to accelerate development at Tanbreez.
Completion is subject to several conditions. Both parties must negotiate a definitive agreement, then secure approvals from shareholders, regulators and Australian courts. A key requirement: European Lithium must maintain net cash of at least A$330 million at closing. A shareholder vote is tentatively scheduled for the third quarter of 2026, with the transaction expected to close in the second half of the year.
The integration process may be smoothed by significant overlap in leadership. Tony Sage serves as both CEO of Critical Metals and executive chairman of European Lithium.
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Markets reacted positively to the news. Critical Metals shares climbed more than 7 percent on the announcement day to around $12.32, while European Lithium’s stock rocketed higher as investors priced in the takeover premium.
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