It has been some time since we have seen any movement from the AVZ Minerals Ltd (ASX: AVZ) share price.
It was slammed into a trading halt on 9 May and has been suspended from trade since then.
Why are AVZ shares suspended?
The company requested that its shares be suspended from trade while it deals with arbitration proceedings relating to an ownership dispute.
Chinese mining company Jin Cheng Mining Company is seeking to be recognised as a shareholder of Dathcom Mining, which is the ultimate owner of the Manono Lithium and Tin Project in the Democratic Republic of the Congo.
Depending on the outcome of the arbitration, at best, AVZ could ultimately end up owning a 66% stake in the project. Whereas at worst, it could be left with a stake as small as 36%.
This has obvious implications to the companyâs valuation, which is why AVZ shares arenât trading.
Whatâs next?
As things stand, AVZ shares are scheduled to return to trade on Friday 1 July. However, thatâs if the arbitration proceedings have been completed. If they drag on, so too will the suspension.
Based on what management has said, it seems unlikely that the matter will be resolved by then.
The Company has considered Jin Chengâs claims in detail and considers them to be spurious in nature, without merit, containing fundamental and material errors, and having no substance or foundation in fact or law. The Company is continuing to take all necessary actions to resist these vexatious and meritless claims and to protect its and Dathcomâs interests.
After further consultation with the parties to the arbitration, the ICC will now decide whether the arbitral tribunal will be constituted by a single arbitrator (Jin Chengâs preference) or 3 arbitrators (AVZIâs preference). This will take about 4 weeks.
The post Will AVZ Minerals shares finally return to trade this week? appeared first on The Motley Fool Australia.
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More reading
- 3 ASX All Ordinaries shares that have surged 300% in the past year
- AVZ share price suspension: What is the Manono Lithium Project they are fighting over?
- The AVZ share price suspension will continue until when?
- These were the worst performing ASX 200 shares in May
- 5 things to watch on the ASX 200 on Wednesday
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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