Why is ASX lithium share Magnis in a trading halt?

A man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading haltA man sits in a chair hunched over a laptop and covered head to toe in frozen icicles to represent Envirosuite's trading halt

The All Ordinaries Index (ASX: XAO) is having a bit of a bouncy start to the trading week today. At the time of writing, the All Ords has spent time in both positive and negative territory this Monday but is presently down by around 0.05%. But one ASX All Ords lithium share isn’t even at the table today. 

The Magnis Energy Technologies Ltd (ASX: MNS) share price closed at 40 cents last Friday. And that’s where the company will be staying, at least for a while.

That’s because, just before market open this morning, Magnis put out an ASX notice. This told investors its shares would be placed in a trading halt, effective from today.

Here’s some of what the notice said:

The Company requests the trading halt pending an announcement to the market in relation to a material transaction, the signed agreement for which was received from the counterparty over the weekend…

The Company requests that the trading halt applied to its securities continue until the earlier of the making of an announcement in relation to the proposed material transaction and the commencement of trading on 21 February 2023.

That’s all we know for now.

ASX lithium share Magnis on ice

Magnis did give investors another update last Friday. But this was related to its Imperium3 lithium-ion battery plant in the US state of New York, in which Magnis owns a 61% interest.

This informed investors that there will be a delay in gaining United Nations certification for the safe transportation of the lithium-ion batteries manufactured at Imperium3:

In one of the last tests performed, a cell reported an irregular result which has resulted in the process starting again with a new batch of cells.

In order to compress the timeline to achieve certification, additional accredited independent certifiers have been appointed. While disappointed with the delay, Magnis is pleased that cells produced by iM3NY are continuing to be sampled by a range of existing and potentially new customers, which reinforces the Company’s view on positive market demand for these new cells.

The Magnis share price reacted poorly to this news, with the company losing a nasty 7.96% last Friday. That put the company at the 40 cent share price Magnis is frozen at today:

It appears that these two consecutive announcements are not related, but we shall have to wait and see what Magnis comes out with later this week.

The post Why is ASX lithium share Magnis in a trading halt? appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen 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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