The AVZ Minerals share price went nowhere in June. Here’s why

The AVZ Minerals Ltd (ASX: AVZ) share price ended last month exactly where it started, and it had a good reason too.

The S&P/ASX 200 Index (ASX: XJO) stock spent the entirety of June in a trading halt as the company fought to keep a majority hold of the Manono Lithium Project.

That means the AVZ Minerals share price didn’t move from its final close of May, remaining frozen at 78 cents.

Let’s take a closer look at what’s been going on with the ASX lithium share lately.

AVZ Minerals share price frozen through June

AVZ Minerals shares remained halted for all of June as the company continued working to keep ahold of its majority ownership over its flagship project.

The project, located in the Democratic Republic of Congo, is 75% owned by the company through a joint venture named Dathcom Mining. La Congolaise D’Exploitation Miniere SA (Cominiere) holds the other 25%.

Previously, AVZ Minerals was planning to snap up 15% of Cominiere’s hold. It was also expecting to sell 24% of its own interest to a third party. The two transactions were meant to leave the company with a 66% interest in Manono.

However, Cominiere recently sold 15% of its stake in Dathcom Mining to Chinese company Jing Cheng. According to AVZ Minerals, the sale breached an agreement between it and Cominiere.

AVZ Minerals and Jing Cheng are now in arbitration proceedings, arguing whether the sale is valid.

If everything goes wrong for the company, it could end up with a hold of just 36% in the project.

The AVZ Minerals share price hasn’t traded since 6 May. The company announced yesterday it expects its stock will be removed from the freezer on 15 July.

It said it’s “encouraged with the progress being made” over the dispute but noted it hasn’t won yet.

The AVZ Minerals share price fell 11% in 2022 (since market close on 4 January) before being halted. It has gained 387% since this time last year.

The post The AVZ Minerals share price went nowhere in June. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper 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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