Greenland Clearance and a 40% Recovery Boost: European Lithium's Merger Clock Ticks Louder

Greenland approves $835M merger for Tanbreez rare earth project; Critical Metals gains buy rating, $20 target, and 40% recovery boost.

The proposed $835 million merger between European Lithium and Critical Metals Corp has cleared a major regulatory hurdle, with Greenland formally approving the acquisition of a 92.5% stake in the Tanbreez rare earth project. The green light arrives as Critical Metals prepares to showcase its pilot plant feasibility study at a key investor conference today, armed with fresh metallurgical data showing a 40% improvement in concentrate recovery rates.

More than 100 institutional investors have been building their positions in recent weeks, with Alyeska and UBS among those snapping up significant stakes. Texas Capital has initiated coverage of Critical Metals with a buy rating and a $20 price target, a call that directly benefits European Lithium given its current 34% holding in the partner company.

The Mechanics of the Swap

The transaction structure is straightforward. European Lithium shareholders will receive 0.035 Critical Metals shares for each of their own shares. Upon completion, the existing 45.5 million Critical Metals shares held by European Lithium will be cancelled, reducing dilution and boosting the free float of the combined entity.

Critical Metals shares closed at $12.91 yesterday, supported by a recently completed $60 million private placement priced at $10 per share. The market's positive reception has been reinforced by the company's parallel efforts to secure a $120 million credit facility from the EXIM Bank, funds earmarked for project development.

A Western Supply Chain Ambition

The merger's strategic rationale extends beyond Greenland. A joint venture in Romania is being positioned as the cornerstone of a mine-to-magnet strategy designed to supply NATO allies and Western technology companies with lithium and rare earths, reducing dependence on Chinese supply chains.

Analyst consensus places the fair value of Critical Metals at around $15, while the Texas Capital target of $20 reflects optimism about the combined entity's prospects. The full takeover is expected to close in the second half of 2026, with initial ore production targeted for 2028 and full output at the main sites planned for 2029.

Management will address investors at a virtual mining conference on May 5, where spending plans for the current year and potential updates on the EXIM financing will be the focal points. For now, the Greenland approval and the technical improvements provide the strongest signals yet that this transatlantic rare earth merger is on track.